Why The Rich Don’t Work For Money – Robert Kiyosaki

Why The Rich Don’t Work For Money – Robert Kiyosaki

In financial literacy, few names resonate as powerfully as Robert Kiyosaki. His groundbreaking book, “Rich Dad Poor Dad,” introduced millions to why the rich don’t work for money in the traditional sense. This idea, though seemingly counterintuitive, has been a cornerstone of Kiyosaki’s teachings and has revolutionized the way many perceive wealth and financial freedom. Keep reading for a deep dive into this philosophy and uncover the principles that drive the economic decisions of the affluent.

The Mindset of the Rich vs. the Poor

Robert Kiyosaki emphasizes that the rich have a different mindset than the poor or middle class—the wealthy focus on controlling their internal economy, philosophy, and finances rather than blaming external factors. The rich don’t work for money they work to build and acquire assets.

Kiyosaki foresaw massive economic challenges coming with increased globalization. While this seems daunting, the rich view it as an opportunity, while the poor only see the danger. The rich see crises and crashes as a chance to acquire undervalued assets, start new businesses, and invest in innovations. People experiencing poverty lament the state of the economy and often make things worse by taking on more debt and liabilities. The rich know how to profit no matter the external conditions. Kiyosaki says, “I make more money in crashes than when they go up.”

Work to learn not to earn

Kiyosaki emphasizes that the goal of work should be gaining knowledge and skills more than earning money. When he lost his last paycheck, it was devastating financially, but it ended up being a pivotal moment in his life. He was forced to become an entrepreneur and learned critical business, investing, and finance lessons.

Too often, people focus on working to get a paycheck. But real prosperity comes from improving your financial intelligence. As Kiyosaki says, “Losers let the fear of losing money keep them from making money.” We should work to learn, gain experience, and improve skills – not just to maintain a steady paycheck. Losing that security forces you to upgrade skills rapidly.

A focus on building a business, not working for a business

“If you’re an entrepreneur and you’re going to be a big entrepreneur, leadership skills and communication skills are more important than a law degree.” – Robert Kiyosaki [1]

Kiyosaki boldly states that leadership and communication skills matter more than formal education for successful entrepreneurs. The rich are focused on building businesses, not just working for them. They take control of their income instead of relying on an employer. They look for employees to work for them not for jobs for their self.

The poor are stuck in a cycle of trading time for money while building someone else’s dreams. The rich use a business and employees to generate income while focusing on higher-level tasks. Creating a profitable business requires strong leadership and the ability to communicate your vision.

A focus on cash flow and not a paycheck

“My last paycheck, I still remember it clearly. It was one of my life’s worst and best days.” – Robert Kiyosaki.

When Kiyosaki lost his paycheck, he could no longer rely on earned income. He focused on building assets like real estate that produced consistent cash flow. This tested his true character. Without a paycheck, how would he continue making money for living expenses? The learning curve is climbed quickly when your choices are limited.

Having a business throwing off cash flow allows for greater flexibility and stability. A job and a paycheck can be lost at any time. However, assets with solid cash flow act as a buffer. The rich focus on having multiple streams of residual income. This provides certainty and room to take risks.

Acquiring Assets Like Real Estate Instead of Just Working for Money

“We create businesses as entrepreneurs. We acquire real estate because as entrepreneurs I have more control over my income, how much I make and pay in taxes.” – Robert Kiyosaki.

Kiyosaki hammers home the point that the rich don’t simply work for money – they acquire income-producing assets. He focuses on building businesses and developing real estate. This provides more control over income rather than relying on an employer. Real estate can be bought and leveraged to produce rental income. Appreciation over time leads to exponential growth of net worth.

Working for money alone is limited. You can only work so many hours in a day. Owning a business allows others to work for you. And real estate pays you while you sleep. Assets that throw off cash flow provide true financial freedom. The rich focus on owning assets, while the poor trade hours for dollars.

The tax benefits of business and real estate

“I pay zero tax, so every time I make, let’s say, a million dollars as an entrepreneur, I immediately invest in real estate. I have a four-to-one step up, so I put a million dollars in real estate. I get four million for the bank. That’s why I love banks.” – Robert Kiyosaki.

A key benefit of business and real estate Kiyosaki emphasizes is tax advantages. Entrepreneurs can utilize deductions and write-offs to lower taxable income. Real estate also allows tax savings – expenses like interest, taxes, maintenance, and depreciation can all reduce tax liability. Businesses are also taxed on their profits not their revenue. Businesses pay their bills, make investments in their business and then pay taxes on what’s leftover. Employees pay income taxes first then pay their bills and make investments with what’s left over.

Kiyosaki also uses leverage from banks to amplify returns. If he makes $1 million from business income, he can put $1 million into a property and borrow $3 million more from a bank. This lets him control a $4 million asset while only putting up $1 million himself. Banks lend at fixed rates, allowing investors to profit from inflationary appreciation.

Key Takeaways

  • The wealthy focus inward on their mindset rather than outward on the economy
  • Losing steady income can force beneficial entrepreneurial thinking
  • Building a business requires leadership, not just business expertise
  • Residual income from assets provides more stability than a job
  • Property and businesses allow more control over your finances
  • Leverage and tax reduction multiply returns for the rich


Robert Kiyosaki stresses that lasting prosperity comes from cultivating an entrepreneurial mindset and accumulating assets that throw off consistent cash flow. Depending solely on earned income from a job restricts your financial potential. The wealthy build enterprises, acquire real estate and leverage tax and lending rules to gain more control over their economic lives. Anyone can begin this journey by reshaping their mental models around money and work to one of an entrepreneur and investor. The rest flows naturally from the inside out. Simply working for money does not provide these same advantages.