Several months ago, I offered up a detailed and rather negative review of the well known personal finance book Rich Dad, Poor Dad. In it, the author, Robert Kiyosaki, encourages people to take on a substantial amount of risk in order to get rich and largely derides people who choose not to take on that risk.
Let’s get the facts straight: I feel that the actual advice as well as the tone of Rich Dad, Poor Dad borders on the absurd. Yet, at the same time, it is easy to understand how someone with an entrepreneurial bent and some competitive fire would find a lot to be inspired by in this book, and I’ve seen comments from lots of people that were inspired by Rich Dad, Poor Dad.
The question then becomes is there value in reading a “bad” book? Years ago, my answer would have been an automatic “no.” What’s the point in reading rubbish advice that you won’t follow? In fact, it wasn’t too long ago when I would toss aside a book or a blog as soon as I read something that I disagreed with.
As I’ve grown and thoroughly explored some subjects (like personal finance), my opinion on the idea of bad books (and blogs I disagree with) has changed quite a bit. It is incredibly valuable to get a diversity of perspectives on any subject. That’s why I actually read all the way through Rich Dad, Poor Dad – I extracted a few positive points from it and was able to really grasp the overall message that Kiyosaki was trying to sell.
In short, I try to read as much as I can on a topic and never stop growing in my understanding of it, even if that means reading things I disagree with, don’t fully understand (yet), or find incredibly challenging in some way.
Let’s take a look at Rich Dad, Poor Dad. What did I learn from it?
I learned that some personalities thrive on financial risk. “Rich Dad” thrived on taking on a huge amount of financial risk. I personally think it’s foolish to dive into businesses cash first, but I’m apparently wired differently. I’m a conservative investor who prefers to manage my money carefully – I’d rather see smaller, stable returns than to toss my cash on the roulette wheel.
I learned that even people who thrive on such risk are rewarded by frugality. “Rich Dad,” in some ways, was a rather frugal person. Of course, Kiyosaki coupled that with promises of fast cars and such for the person who followed the “Rich Dad” path, but there is value in frugality even for risk-taking entrepreneurs.
I learned that some people who thrive on this risk look at people who avoid risk with disdain. Kiyosaki looks down upon “Poor Dad” and refers to people who work for others and slowly accumulate wealth in a less-risky environment as “hamsters.” That perspective actually explains a lot about how CEOs and many business leaders operate – we’re just “hamsters” in the machine to them.
These were useful lessons, and they altered my perspectives on some issues, even if I thought much of the advice in Rich Dad, Poor Dad was rubbish.
How can you decide what’s right? If you read a bunch of books on the same topic, you’re bound to find contradictions between them. The best guidance is finding the points where lots of sources agree and trusting your own intuition after you’ve read a lot of material.
For instance, after reading Rich Dad, Poor Dad and some individual stock investing books, coupled with reading stuff like Your Money or Your Life and The Bogleheads’ Guide to Investing, you might find that the answers that make the most sense to you are entrepreneurial and have a lot of risk. If that’s the case, then by all means jump into entrepreneurship and aggressive investing – but don’t ignore lessons that come from more conservative sources. The greatest dangers are never bothering to learn more, ceasing to grow in what you know, and failing to understand what others are thinking even if you disagree.
For me (and for a lot of my readers), conservative investing, frugal living, and a debt-free lifestyle are the goals and the ideas that make the most sense – and books like Rich Dad, Poor Dad, though they provide valuable insight into other perspectives, just reinforce the idea that the debt-free road is the right road for me to follow. So, yes, I might sometimes review books or link to blogs that are way off base from this perspective, but even those books can teach us a lot.