Dave Ramsey vs Robert Kiyosaki- Is either right or wrong?

What Robert Kiyosaki Teaches

Let’s go to the other side of the financial fence now. When Robert Kiyosaki came onto the picture he basically took what Dave was teaching and he turned it on its head by suggesting to readers to do the opposite of what Dave teaches in many situations.

1. Start a Business

Robert believes the best way to become rich is to start a business. He uses the example in his book how his “rich dad” started a business, his “poor dad” was an employee. This isn’t the only way he teaches but it can be very powerful especially nowadys with the numerous ways to promote your brand.

2. Purchase Assets

Kiyosaki defines an asset as anything that puts money in your pocket. A liability is anything that takes money out of your pocket. He brings up the fact many people spend their lives accumulating libilities attributing to their inability to build wealth.

3. Buy Real Estate, Stocks, and Businesses

Instead of buying mutual funds, he says to buy real estate, to buy a business, to buy individual stocks. Is there anything and inherently wrong with any of these asset classes? No, not necessarily. Robert Kiyosaki really dislikes mutual funds because you have to control, normally no leverage with stocks, and the tax code is written to promote real estate investing.

4. Learn from Mistakes

Be prepared to make (financial) mistakes. It’s important when you fall down to learn from it and learn how you can improve from this point forward.

5. Use Debt

There’s probably nothing more contradictory or opposing in this battle between Dave Ramsey and Robert Kiyosaki than debt. Robert Kiyosaki will say USE debt – use as much as you can possibly get. Instead, Dave says get out of debt, using the debt snowball method which for math nerds isnt the most efficient way, but he takes into account human phycology and I agree so strongly with this seeing it work with my friends and family.
 

6. Use the Tax Code

Robert loves Real Estate investing because of the power of leveraging and the tax benefits he gets. This includes, writing off mortgage inerest, depreciation, and part of expenses. He also said  “Tax breaks are rewarded to the rich who build the economy and provide jobs. But that’s an inconvenient truth no one likes to hear.” He goes into this deeper on his own site here.

7. Don’t Buy a House

Robert Kiyosaki says don’t buy a home. He mathematically argues that a home can be a poor asset.

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