What’s wealth and what the rich focus at? Here’s great answers by Robert Kiyosaki.
“Wealth is a person’s ability to survive so many number of days forward or if I stopped working today, how long could I survive.” – R. Buckminster Fuller
“The rich focus on their asset columns while everyone else focuses on their income statements.”
In 1974, Ray Kroc, the founder of McDonald’s, was asked to speak to the MBA class at the University of Texas at Austin. After a powerful and inspiring talk, Ray was asked by the students to join them at their favorite hangout to have few beers, to which Ray accepted graciously.
At that time Ray asked, ‘What business am I in?’
Everyone laughed, thinking Ray was just fooling around.
When no one answered, Ray asked again, ‘What business do you think I’m in?’
The students laughed again, when finally one brave soul yelled out, ‘Ray, who in the world doesn’t know that you’re in the hamburger business? ‘
Ray chuckled, ‘That’s what I thought you would say.’ He paused and then quickly added, ‘Ladies and Gentlemen, I’m not in the hamburger business. My business is real estate. ‘
Ray spent a good amount of time explaining his viewpoint. In his business plan, Ray knew that the primary business focus was to sell hamburger franchises, but what he never lost sight of was the location of each franchise. He knew that the land and its location were the most significant factors in the success of each franchise. Basically, the person who bought the franchise was also buying the real estate under the franchise for Ray Kroc’s organization.
Today McDonald’s is one of the largest owner of real estate in the world. McDonald’s owns some of the most valuable intersections and street corners in America and around the globe.
Most people work for everyone but themselves. Financial struggle is often directly the result of people working all their lives for someone else.
There is a big difference between your profession and your business. When asked, ‘What’s your business?’ people say, ‘I’m a banker.’ And when further asked whether they own the bank, they say ‘No, I work there.’ They are confused their profession with their business.
A problem with school is that you often become what you study. The mistake in becoming what you study is that too many people forget to mind their own business. They spend their lives minding someone else’s business and making them rich. Start minding your own business. Keep your daytime job, but start buying real assets, not liabilities or personal effects that have no real value once you get them home. A new car loses nearly 25 % of the price you pay for it the moment you drive it off the lot.
Keep expenses low, reduce liabilities, and diligently build a base of solid assets. As per author’s view real assets fall into following categories: