Why Your Banker does not ask you for Your Report Card

By Robert Kiyosaki

In an excerpt from his new book Rich Kid Smart Kid™, Robert Kiyosaki shares more of the inspiring and practical financial knowledge passed on from his Rich Dad.

Education is more important today than at any other time in history. As we leave the Industrial Age behind and enter the Information Age, the value of education continues to increase. But is the education that you or your child receives in school adequate to meet the challenges of this brave new world we enter?

Today, many well-educated people are facing the same economic difficulties as the less educated. They repeatedly find themselves having to get additional education and training in order to satisfy their current job requirements.

People often say to me, "I won't need much money when I retire because when I retire, my living expenses go down." Your living expenses may go down after you retire, but your healthcare will go up dramatically. Will your children's education prepare them to be financially secure enough not to need government financial and medical support at the end of their working days?

The Rules Have Changed
In the Industrial Age, the rules were: go to school, get good grades, find a safe, secure job with benefits, and stay there all your life. After 20 years or so you retire, and the company and the government take care of you for the rest of your life.

Today, the rules are: go to school, get good grades, find a job, and then retrain yourself for that job. Find a new company, a new job and retrain - and hope you have enough money set aside to last you much longer than age 65.

Financial Intelligence
I had two father figures in my life. One man I called my Rich Dad was my best friend Mike's dad, and one man I called my poor dad was my real dad. The benefit I had was that both men were, in my opinion, geniuses in their own right.

My poor dad was an academic genius and educator. From age nine I had problems in school. I saw no relevance between what I was being forced to learn and how it applied to the real world. My smart but poor dad guided me through this very difficult part of my life.

My Rich Dad was a financial genius and a great teacher. He began preparing my young mind to think like a rich person. Knowing I was going to be rich, regardless of what I was learning or how I did in school, created some unique attitude problems for me while I was still in school. Both of my dads worked hard to keep my attitude problem in check.

My Rich Dad said your banker wants to see how smart you are after you leave school. "All my banker wants to see are my financial statements. The problem is, most people leave school not knowing what a financial statement is." Rich Dad would also say, "Understanding how financial statements work is essential for anyone wanting to build a life of financial security." Today, it is essential that your child has the skills to ensure a life of financial security.

The current educational system covers two main areas: scholastic and professional. But today, we need more new education. Every student now needs some of the basic education my Rich Dad gave me: Financial Education – the education to turn the money you earn from your profession into lifelong wealth and financial security.

My smart dad was the head of the educational system of Hawaii, which he did his best to change. He later said to me, "There are three different types of teachers and administrators in the system. There is one group that works diligently to change the system. There is another group that works diligently against any kind of change. And the third group does not care if the system changes or not. All this group wants is their job security and their paycheck. And that is why the system has remained the same for years."

Lead through example
Many parents say to their children, 'Go to school and study hard. A good education is important.' But many parents who say this don't continue with their own education or studies. My smart dad also said, 'Parents are a childs' most important teachers… but students learn by watching more than they do by listening.'

Approved abridged excerpt from Rich Kid Smart Kid™. ©2001