October 15, 2020


A typical middle class family all around the world has almost similar finances. Recently I have read on this subject and very much impressed by the thoughts of Robert Kiyosaki in his books Rich Dad Poor Dad and Cashflow Quadrant. Here in this blog I have tried to summarize that thoughts.

Rich and Poor!

No one really aware about the main class that is the middle class. What is a middle class after all?? What I think, middle class is the family which always have debt (loans) through out their working age. Second, earning persons of the family has to do some active jobs (or self employed) and hence active income is essential. As Robert Kiyosaki points out that we are living in Information Age right now which started approx after fall of the Berlin Wall in 1989. From 1492 when Christopher Columbus found Americas we were in the Industrial Age. This is a very good concept to understand the current situation. 

The main issue with current Age is the uncertainty of future income (typically in retirement age). In industrial age there was a well defined pension plan which was sponsored by the Govt or employer. In current times, this is now vanished. Now pension plans are not dependent on Govt or employers’ contributions. Rather they are depending on how much one contributes during working age. And for self employed persons virtually there is nothing after working age if they have not saved handsomely and more importantly they have not invested smartly this saved amount. This also implies to job doing people too. 

So as one can observe, the main difference of this financial definition (Rich/Middle/Poor) is depending on following:

– How we earn money

– What we do to save and to invest this money

– How much debt (loan/leverage) one serves through entire life

How to become The Rich?

A simple middle class family can become rich one day? Of course it can be done but what really means by The Rich? How to define it? What I understood the rich is —

– Not depending on regular/active income (Passive income from multiple assets)

– Have plenty of time to do what one really loves (Freedom of time)

Second important learning is to understand what is Wealth? We often take it wrong that wealth equals to money. 

Wealth is defined by time, not money!! 

This is really interesting. Wealth is not how much amount we have but how much time we can survive without actively working for money. If I have Rs 2 Lac and my monthly house expenses is Rs 50,000 than I am wealthy by 120 days! So the real rich family have such a source of (passive) income that their monthly expenses are taken care automatically. 

Curious case of Sushil Kumar – KBC winner

Do you remember a person named Sushil Kumar winning Rs 5 Crores in KBC before few years. Recently he posted in social media that now he is broke. So in one lifetime he was a Crorepati and now broke too! The definition of wealth suits perfectly here.

What to do?

So now the question remains what to do to become rich – wealthy? 

– Try to save large amount per month from your current regular income

– Invest this amount SMARTLY (Do not buy traditional insurance policies!) for at least 20 years

– Try to build a system or be part of such existing system (e.g. Franchise/ Network marketing)

– Learn new ways to generate passive regular income

– Read a lot !!!


1) Rich Dad Poor Dad by Robert Kiyosaki

2) Cashflow Quadrant by Robert Kiyosaki

3) Parable of Pipelines by Burk Hedges

4) the Richest Man in Babylon by George S. Calson

5) Think and Grow Rich by Napoleon Hill

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