On today’s episode David and Ken share their review of the book that changed their lives.
Do you think your house is an asset or a liability? Listen in to find out, you might be shocked to hear the answer.
“Focus on growing your asset column and not your income column (increase cashflow and only buy assets, decrease liabilities)”
I’m going to go get my master’s degree. I’m gonna go get a PhD. I’m going to, I’m going to go to, I’m going to do this. I’m going to do that to, to, to climb up the corporate ladder to make more money, to pay for more stuff.
I’m not a neurosurgeon, but whatever part of your brain says, fuck it. I’m going to buy this. Anyway, this book helped me numb this switch.
Welcome everyone to the firingtheman.com Podcast, a show for anyone who wants to be their own boss. If you sit in a cubicle every day and to know you were capable of more than join us, this show will help you build a business and grow your passive income streams in just a few short hours per day. And now your host serial entrepreneurs, David Schomer and Ken Wilson,
welcome everyone to the firingtheman.com Podcast. Today, Ken and I are going to be talking about the book that changed everything. The book that changed our lives. And I want to start off with a quote. And this quote is from Mark Twain from 1895. And this quote reads the man who does not read good books, has no advantage over the man that can’t read. And Ken, just before we fired up the podcast you were talking about reading and how it’s had an impact on your life. So before we dive into this book, uh, can you share with the audience how has reading helped you and how it, how has it changed your life?
Sure. Yeah, absolutely. And, and that quote, you just spun out from Mark Twain, that was deep. I like that. Uh, and it really resonates with me personally. You know, I’m in my early forties and I, I didn’t start reading heavily until I would say, you know, I, I read in school when I was made to write like, Hey, you got a book report, you gotta do this. Gotta and I, you know, I read in college cause I had to do reports and stuff, but I didn’t find value in, I didn’t read until my late thirties. Right. I got, uh, you know, had a life change or went through a divorce and I got into a new relationship. My girlfriend was an avid reader and I was like, well, what do you like? What are you doing? She’s like, I’m reading. And I was like, she goes, you should.
I was like, I don’t like reading. She goes, what? Just you, you, you do like reading, you just haven’t found the, the right stuff to read. And I was like, that’s interesting. So I went out and, and found some books that I liked and I was like, Holy shit. Like, like I, and now I enjoy reading. I’m an avid reader and I would, yeah, I would say to anybody out there, if you, if you, if your answer is like, I don’t like to read, you’ve probably not found the right book to read, whether it’s a, and I do both. I do, I do physical books and I also do audible. So you know, if, if you have a long commute, if you want to, if you walk, if you do whatever, you know, and if you just don’t like flipping pages or if you like Kindle whatever, audible, that that’s huge. More importantly, the monumental shift and change that it’s had in my life is, is massive. Right? In the last probably five years, I’ve probably read, I don’t know, a hundred books, 120 books, and that’s made a massive impact on my life. Like complete game changer.
For sure. For sure. You know, I, uh, I suffer from, uh, extreme ADHD, like I cannot sit still and, uh, and it took me until my mid twenties to realize, Hey, maybe sitting down and reading a paper book is not for you. But audible, I, if I signed up for an audible subscription probably five years ago and I get three or four books a month and, uh, and that’s just something I, whenever I see it on my credit card statement at that is money well spent. Um, I use up all my credits and, uh, you know, if you’re listening to podcasts, audio books may be a great option for you. If you like listening to things and you can learn from listening, give it a try. Um, you know, I, I listened to a, the book that we’re going to be talking about on a, you know, it was probably two or three years ago and, uh, it changed my life and, uh, and I think that term is way overused. It changed my life, but this one really did. And so, uh, without further ado, the book that we’re talking about is a rich dad poor dad by Robert Kiyosaki. And, uh, so let’s start off. Ken, where did you first hear about rich dad poor dad?
I was researching e-commerce selling and it was actually a, one of the influencers that was doing a YouTube video and it was like, Hey, this changed my life reading this book and it’s made me do what I’m doing now. And I was like, Oh, shit. Like it, like that’s a, that’s impactful, right? When someone says, this changed my life and I, and I thought, well, let me let me, and it was in my, you know, phase of, of consuming a lot of books. So I put it in my lineup and read that. And it really did change my life. It changed how I view money. It changed how I view our education system now. We both read this book at different points in our life and it had different impacts on us. What now? How did you hear about it and what kind of impact did it have for you?
So I was interested in getting into real estate. And for anyone who’s interested in getting into real estate, I would really recommend the bigger pockets podcast. They have an awesome podcast and at the end of every show they ask their guests, what’s your favorite book? I probably listen to 10 episodes. And I think seven out of 10 people said, rich dad, poor dad in a couple people even said, well, I know everyone says this, but rich dad, poor dad. And I was like, all right, there’s gotta be something to this. All these successful people. I’m hearing talk about this book there, there’s gotta be something to this. So I listened to it and it really did have an impact on my life. You know, specifically about how I’ve managed my personal finances. You know, I don’t know if you had this experience, but it did kind of bring about a little bit of shame, like about how I’ve managed my money until now.
And I’ll give you an example. He talks about uh, buying assets versus buying liabilities. When I was 23 years old, I had my first job. I was making decent money and for my whole life, you know, grown up in Iowa, I think this is a symptom of, of this, but I wanted to buy a big lifted truck, you know, a six inch lift. And so I went to the dealership and I bought a brand new 2015 GMC Sierra, the six inch lift kit and is a bad ass truck. But you know, I took a loan out, I put a small down payment on and I had $500 or $600 payment on it. You know, it took five years to pay off and now that sucker’s paid off and it’s not worth near what I paid for it. And you know, that was, that was an example of buying a liability and we’ll go into that.
But it made me kind of think about, all right, how have I handled money and how should I handle money? And you know, most recently I took, I think I’ve mentioned this on previous episodes, my wife and I just had a kid, how am I going to teach my son about money? And you know, what lessons, you know, that’s a point that they make in this book is a lot of your habits and your mindset around money comes from your parents. And I think that’s true. You know, that resonated with me. I think my thoughts about money kinda came from my upbringing in, in just kind of watching my parents. But you know, what lessons am I gonna want to teach my son? And you know, you had just said like, you bought this book for your son. Yeah,
I’ve gifted this book, uh, four times. Uh, my buddy James. I know you’re listening, you’re getting ready to retire from the army and I love you like a brother. I’ve gifted it to, uh, my son, my daughter and Liam and hopefully it has an impact as much as it has had on me. So, and I will give this book a lot more.
Yeah, I’ve got four younger brothers. I’ve given it to a, two of them. Uh, my one brother who’s 27 and the other one who just went to college, the brother that is 27, he has said that this has definitely changed his mindset in thoughts around money. He gifted it to my mom and my mom’s nearing retirement, you know, she’s five, 10 years away from retirement. And she said, God, I wish I would have read this 30 years ago. And you know, I think for, for people that are listening to this, regardless of your age, it’s never too late to pick up a good book and learn something.
Before we get into it, can you, can you give a 10,000 foot view to our audience on, on this book?
Yeah, absolutely. So a rich dad, poor dad, it’s written by Robert Kiyosaki, and he talks about having two dads. One was his real father, and that was his poor dad. Uh, this man was very well educated. Uh, he was employed, he worked for a university and made good income. Uh, but he also always spent that, that income. The second was his rich dad. Now his rich dad didn’t any, he didn’t have a college education, uh, but liked buying assets. He was into real estate and really taught Robert about, about managing money. So, so this book, it kinda tells the story of, I would say, you know, the poor dad kind of illustrates the standard American way of managing money. If you earn $50,000, you spend 49, and you know, people tell you your house is your biggest asset and you know, you work, you should enjoy that money.
You should buy a new car. And, uh, so that, that kind of represents the poor dad. And the rich dad doesn’t come from an Ivy league school, but the guy hustles and grinds, uh, doesn’t live in a huge house. He doesn’t buy new cars, uh, when he buys something, it’s often a cash producing asset. Like he puts money to work for him as opposed to going out and working for money. And this whole book just kinda, it’s a comparing contrast against the rich dad and the poor dad. And it’s a great way to tee up this topic. Um, it, you know, it kind of gives an example of, Hey, here’s someone that’s doing it right and here’s someone that that’s doing it wrong. Although on paper they conform to the standard American way of living, go to college, get a good job, earn a good income, buy a big house.
And, and so anyway, that’s, that’s kind of the premise of the book. And I think for anyone listening who hasn’t read this book, do yourself a favor and read it, it, it will change your life. I mean, I, I haven’t heard anybody that’s read it and said, all right, books full of bullshit. I didn’t learn anything. I haven’t either. You’ll take something away from it. So, um, but anyway, that, that’s kinda the, the, uh, the premise of this book. So, um, anyway, when Ken, when you read it, what were some of the biggest takeaways that you had?
Okay, so as we peel back the layers on this book and it’s very dense, right? Like there’s a lot to get here, a lot of layers. And one of the layers of that that you touched a little bit on well, there’s a lot of them, but the first one, the education system, our modern day education system and, and uh, Roberts, um, rich dad, you know, he was a Stanford grad and he was one of the lead educators in the state of Hawaii. So the education system does not teach what Robert Kiyosaki is teaching it. It teaches, learn a trade, learn a skill, go to college, work a, work a career. You have a job, you work for a company that, that that’s the kind of the transition. And the education system does not teach about money. It does not properly teach about assets or liabilities. So I don’t know about you, but when I went through school, I had one class on money and it was called money, credit and banking.
And it was literally, this is a checkbook, this is a bank you deposit, you know, you go to work, you deposits your money in a bank and you operate a checkbook and you do your, your debits and credits and on your checkbook and that’s how you keep them your money, you know, you get your paycheck, you put it in the bank, and then you have your expenses, your house and all that. That’s literally what I learned about finance in school. So that’s one of the layers is that we’re not really teaching properly what an asset or liability is.
Absolutely. All the while I can tell you what a sarcophagus is. It’s, it’s a mummy inside of a tomb. I mean that’s something I took from my elementary education. How has that, has there ever been a sarcophagus day? No, but there’s a tax day, April 15th I mean it’s just the things that, that the education system focuses on. man it’s really not relevant. And so I think, you know, for people that are parents, Oh this is huge. Like, you know, if this is something that’s not being addressed at school, this is something that needs to be addressed at home.
One term that that Robert Kiyosaki’s in this book is the rat race. If you get into, you know Robert Kiyosaki and reading his books, the rat race, right? That’s, that’s what most of us are in. And, and you get that, the rat race, let me define that a little bit. So you get a job, you buy a car, you buy a house, you get cable, you get a phone, you get Netflix, you get up, you get all these expenses, right? So then you, then you go to your employer, okay, all of your bills come in and you need more money to pay those bills. So you go to your job and your boss says, well, I want you to go to more college. I want you to go to more classes, go to get another degree and to pay for the, to get another to get a raise. Right? So you then you, okay, well I’m on this mission.
I’m going to climb the corporate ladder. What does that take? I’m going to go get my master’s degree and go get a PhD, I’m going to, I’m going to go to, I’m going to do this, I’m gonna do that to, to, to climb up the corporate ladder to make more money to pay for more stuff. Right? That’s, and it’s a cycle that is the rat race. So I’m going to give you a, an example, a real life example for me personally. I’m going to give you numbers. I’m going to lay it out there. So, another podcast, I’ve, I’ve admitted that I have shiny object syndrome, right? I, you know, I’m very humble. I have lots of faults in and I do not mind admitting them at all. That’s one of my faults. Shiny object syndrome. I still have it today and I’m a recovering addict of shiny object syndrome.
So, uh, this one is a, it’s a keeping up with the Jones example. Okay. And so, like I said, like I said, in previous episodes, I went through a life changing event about five years ago. I got a divorce and it was a life changing event for me. So, uh, I, I bought a Ford Raptor, which if, you know, if you’re a part of our tribe, you, you know what a Ford Raptor is, it’s a badass truck, right? If it is a bad-ass truck, so you know, can you imagine going through divorce? You’re like, God damn it. You know what I, I need to change. I want to do this, I want to do that. And I drove a civic hybrid when I, you know, in my married life, a Civic okay, you know what? I’m divorced now. I got all this money I went out and bought a Ford Raptor $50,000 – $60,000 truck.
I’m like, fuck it. I, I want this truck. It’s bad-ass. I got it. On paper that Ford Raptor, it costs me $600 a month in a payment. I drove it like a banshee, right? I filled it up every week and it had a 40 gallon tank that was a hundred dollar bill every week. David, a hundred dollar bill, that’s $400 a month. Okay? So you got a $600 payment, you got $400 in gas. And my insurance, $150 bucks a month, save $1,150 a month, a Ford Raptor, a vehicle that got me from point A to point B, $1,150 now when you see somebody driving around on the street and a truck and you’re like, you know, they’re doing their bit, $1,150 is a lot of money for a vehicle, right? You know what? When I, when I sat, when I got behind that wheel and I drove to work or I drove my kid somewhere or whatever, at that $1,150 it was kind of, it didn’t, it didn’t really hit me.
I’m going to fast forward to today and then we’re going to define assets and liabilities. So today I drive a Volkswagen Jetta I bought it used and I paid $13,000 for it. My car payment is $243 and I spend about a hundred dollars a month in gas and the insurance is a whopping $65 okay? So the total expense from my a car today is $408 a month. And some of that’s a business expense that I write off now cause I have a business. Right. We’ll talk about that later. But so a $1150 Raptor, $408 Volkswagen. That’s okay. So that’s the difference between when I, before I read rich dad poor dad to now.
I’m glad you brought up that example and I’m glad that you specifically used the words fuck it because this book helps me. Whatever. I’m, I’m not a neurosurgeon, but whatever part of your brain says fuck it, I’m going to buy this. Anyway, this book helped me turn the, it helped me numb that switch. It helped me kind of like eliminate that switch from my brain. And uh, yeah I the same thing with, with my truck. It was like, fuck it, I deserve it. I just got out of college. I’ve been working hard for all these years. I deserve this lifted truck. And, and I can tell you, um, so if you want to know what I drive today, I still drive. I still drive that truck, not fuel efficient, but, um, it’s paid for, it’s paid for. And I’m going to drive that son of a bitch until the wheels fall off, um, because it’s paid for. And if I think about, you know, my next vehicle, um, it’s definitely gonna be used and it’s definitely not going to be a $40,000 investment. And so you see them keeping up with the Joneses and, uh, it’s kinda, it’s kinda weird, you know, I don’t know anybody that has a cool car, like a, you know, a really nice car and I think they’re a cooler person.
You know what I mean? Like there’s no one that I’m like, Oh, he’s kind of a douchebag, but Hey, he’s got a new suburban. Actually, he’s not a douchebag. He’s cool. Like, it’s, it’s, uh, it’s, it’s odd, but me and everybody falls into that trap. And, you know, I see it, I work at a public accounting firm. It’s a group of people that all should know better, right? You know, it’s presumably people that really understand money and understand numbers. You see people get promoted, what do they do? Immediately? Go find a real estate agent, buy a bigger house, get a pool, um, go get a new car in. You see this happen over and over and uh, in a book, like this is a good way to kind of check yourself.
One little sidebar that I’d like to kinda kind of jackhammer in here is as a social media, I think social media is the goddamn devil. And I think a lot of people put too much stake in social people. I mean, me, you, David, myself, everyone, right? So we see Sally seven, six, nine on social media talking about her new inground pool, right? Well, God damn it, we, we want to go get a new in ground pool, right? But what we don’t know is Sally six, seven, nine is, is getting ready to file for bankruptcy because she can’t pay her goddamn bills right. So social media. I think it’s the devil in where we put our energy and focus on on stuff. And, and I think understanding what this book is about, the, the basics of this book will really bring you back level-set.
So Ken, when you were talking, you had mentioned assets versus liabilities. Can you go a little more into that?
I’m going to break down some examples an asset. A share of a stock in a company. So you go to the stock market, you buy a share of stock in a company that’s an asset, right? Or rental property with positive cashflow. Say you own a house, you know you, you pay the bank $1,200 a month for the mortgage on that property. Your renter pays you $2,000 for rent. You have the extra as positive cashflow. That’s an asset, a profitable business. You own one that you don’t manage day to day one that you own and it’s profitable. That’s an asset. Brings cashflow into you. Anything that brings cashflow in is an asset. Let’s cover liabilities. Your car, a boat bought a boat for a hundred grand. That boat’s worth 70 grand now and you’ve got to pay for the slip. You gotta pay for the gas, you got to clean it, have to do everything.
It takes money. Uh, you, you’ll notice a trend for the liabilities. As I go on. Golf clubs, I paid thousand dollars for golf clubs. They’re probably worth $200 now. They decreased in value for me personally, I would like to say they’re an asset because I can play golf better. There a liability, decrease in value, their shiny object, right? I didn’t need those golf clubs. The other golf clubs I had were just fine. I saw an ad on Facebook and I bought those goddamn golf clubs cause I wanted to play better golf. Right? You’re, this is one that’s going to trip a lot of people up. And this is one of the premises of this book, I believe, uh, which will impact a lot of people. Your primary residence.
That was huge because it goes against the grain of what you hear forever. I mean, it’s, it’s, you buy a house, you pay it off you know, it increases in value. Uh, but the key here is it’s not, it’s not a cashflow producing asset. There’s, there’s, you know, I look at why you own a house. Yep. I own a house. Uh, if I look at how much cashflow it’s produced since I’ve lived here, it’s been zero. Could the market tank tomorrow? Maybe, who knows? But it hasn’t given me any cash in my pocket that I can spend now have just this week, my garage door, wouldn’t shut, watched a bunch of YouTube couldn’t fix it myself. Have to call the garage door company. They come out replace a sensor’s 150 bucks. I mean, if you’re a homeowner, this story should sound familiar. Owning a house is expensive. It requires cash input just to keep it up and going. And so this was one that shocked me. And when I read that I was like, ah, now this, that’s a radical thought. But you know, Robert Kiyosaki goes into great detail about how your house is not an asset, how it is a liability.
So David, how has this book has had an impact on the way you view your expenses?
You know, one thing he talks about is expense creep. And this one really hit home for me when my girlfriend and I, when we were back in college, if we’d go on a road trip, we would put the seats down in the back of the SUV and we’d sleep in the car. We won’t get a hotel. Uh, and that was, that was just what we did. Cause we didn’t have any money. And couple of years later we both had jobs but we weren’t rolling in cash. So instead of sleeping in the car, we would go to a shitty motel if we were traveling, you know, across the country, we’d stay in a shitty motel, you know, the 40, $50 a night. And that was, you know, it kind of tracked our income. And you know, now I, as we travel across the country, I, you know, we’ll see.
Like, you know, I wonder what Marriott has has going on or I wonder what Hilton has going on. And that’s a super subtle thing. But I think that that happens with a lot of people is you, you would think, right. Every year you go, you know, if you have a typical W2 job, you go in, you get a raise, right? You should have more money the next year. But what happens is, is expenses creep. You know, Rob, Robert Kiyosaki, he talks about his poor dad, you know, was making hundreds of thousands of dollars but also had hundreds of thousands of dollars of expenses. And so I think that that is, you know, something that everybody can take away from this book. You know, if your income goes up, um, that doesn’t mean your expenses need to go up. And just to be conscious of that, that expense creep, because it is, it’s very subtle. You know, I don’t think my wife and I ever had a conversation that went something like, Hey, we’re making more money. Let’s stop sleeping in the car. It just kinda happened in, in, you see that happen a lot.
I also will say we went on road trip, my wife and I, and I listened to it again with her. And you hear about, you know, what, what’s the biggest marital problem that people have? It’s money. When I think about this book, this was a huge reset for me and how I thought about money. It is a good thing, you know, for my spouse to listen to this book or read this book too so they can have that similar reset. You know, it has helped me and my wife stay more on the same page when it comes to money. It’s been a benefit to our relationship.
You know, I’ve never, I never thought about that as a, a book for your partner to read and understand. You’re absolutely right. You know, if, if your partners on the same, if you’re married, you have a partner that shares, you know, financial burdens and responsibilities as you do, they need to be on the same page. Right. Or at least somewhat on the same page. That’s huge. You know, I never thought about that. It kind of leads me into the, uh, one of the last topics I’d like to cover. You know, something that Robert Kiyosaki really promotes is financial education. And if you think about it, you know, financial education minimizes the risks because if you, if you research something and you understand it, you’re likely going to make good decisions, right?
100%. Yeah. And like, and not to interrupt you, but like people that are buying stuff on Amazon, like last week I probably 20 or 30 minutes researching a breast milk bottle warmer for my son. And like, you’re reading reviews, you’re, you’re, you’re really digging in trying to figure out what’s the best way to, what’s the best way to go. You know, I didn’t, I didn’t spend that amount of time learning about personal finance or how I can do a better job, but God is that important. And so, you know, it seems like people really research things that have a very nominal impact on their life that they don’t think twice about going and showing up to a job for 40 or 50 hours a week. They’re not, they’re not thinking about how, how do I get out from underneath this rock
circling back to financial education. So what my message and David’s message, our message to you would be, invest in your financial education. Read this book, understand you know more ways to generate an income streams and make your money work for you and not work for your money.
It’s huge. And you talk about investing in that financial education, that’s 10 bucks. You know, I’ll tell you, you know, this is a positive ROI activity. Go to firingtheman.com. Go to our resource page, click on that affiliate link buy Ken and I a cup of coffee. So to close up the episode, Ken and I have both shared a book that’s changed our lives. To you, the listeners, if you have a book that’s changed your life, please reach out to us and share it with the firingtheman.com Nation
Books make us better. I mean, they have clearly made me a better person, a better husband, a better employee, a better businessman. And you know, whenever somebody says, Hey, this book changed my life, it really gets my attention. And so, uh, there’s gotta be books out there. So for you, avid readers, let us know if you like today’s episode and would like similar content, go to firingtheman.com or check us out on social media at firingtheman on Instagram, firingtheman Facebook page and firingtheman on YouTube for some digital shorts. Thanks for tuning in and we’ll see you next time.