rat race

refers to, but if someone asked, how would you define this concept? A good definition for the concept
of the rat race is “The endless routine of working for everyone but yourself.” In other words, a rat race
consists of doing all the work by yourself, while others - your bosses, the bill collectors, and the
government - reap the benefits. When we think about the

rat race

, we feel that we are all somehow involved and most of the time, it is something that we all hate. But if
that’s the case, why do we keep racing? According to the author, humans are so afraid of society’s
disapproval, that they allow their lives to be dominated by what other people think. For instance, think
of the mantra “Go to school, get good grades, get a good job.” This mantra is as popular as ever, despite
the fact that it is an outdated piece of advice built on past values and ideas. A few decades ago, people
who were fresh out of college were very likely to land a job. Most of them would spend their whole
adult lives working for the same company and would end up retiring with a cushy pension. Today,
however, this life plan is no longer effective and getting good grades in college doesn’t guarantee a life
free of financial struggles or of poverty. In today’s economy, those who study hard, get into a good
college, graduate, and land a good job are still in danger of never seeing financial growth. This is mainly
owed to the fact that they are stuck in the “rat race”. Instead of enjoying the rewards of their hard work,
people allow their bosses to get rich and end up with nothing. Nevertheless, a lot of people still believe
in and follow the outdated mantra mentioned above because they fear what others might think.
Humans are genetically built to always try to be part of the group but in this day and age, this type of
attitude is not very helpful. While it might help some people avoid poverty, it certainly won’t make them
rich. Because we are so afraid of society’s disapproval, we cannot leave the “rat race” and instead of
growing wealthy, we become trapped.

RICH DAD, POOR DAD CHAPTER #1: Ignorant people are very likely to make irrational decisions due to
their greed and fear.

When it comes to money, rich people and poor people have something in common - they experience the
same basic emotions:

greed

and

fear

. If you are wealthy, you will probably focus on all the new and amazing things that you can spend your
money on (greed). If you are poor, you will spend most of your time worrying about money and about
not having enough (fear). People who are ignorant and who don’t know much about managing their
finances are extremely likely to let these two emotions control their decision-making. For instance, let’s
say your boss just gave you a nice promotion which came with a hefty pay raise. If you were wise from a
financial point of view, you might consider investing the extra money and buying stocks or bonds. These
investments would increase your chances of earning more money over time. You could invest the extra
money into something like stocks or bonds, which would earn you money over time. But if you were a
financially ignorant person, you would immediately think of making a new purchase like a house or a
car. This type of behavior indicates that you allow your emotions to take the wheel. The fear of losing
money and the need to own certain physical objects (greed) are so powerful that you won’t like the idea
of investing in stocks. This is owed to the fact that you want to see an immediate change and fear the
perceived risks that come with not spending the money right away. You would, of course, ignore the fact
that money well invested will bring long-term wealth. As we mentioned above, you will probably feel a
desperate need to use your money for improving your lifestyle. For instance, you might consider buying
a nicer car or a bigger house. At first sight, these assets will seem safer than buying shares in a company
as they are palpable. But if you take a moment and really think things through, home and car upgrades
come with higher bills and a bigger mortgage. These expenses will ultimately have a negative effect on
your financial situation. This is how two negative emotions - fear and greed prevent financially ignorant
people from achieving long-term wealth. So what can you do in order to prevent these emotions from
taking over? The first and most important thing is to start learning and build up your financial
knowledge. Learning more about important financial concepts such as risk, debt, and investments will
place you in a much better position and will prevent you from making irrational decisions. Fear and
greed will prevent financially ignorant people from making rational decisions.

RICH DAD, POOR DAD CHAPTER #2: Although financial intelligence is vital for our personal and collective
prosperity, we receive no formal training.

The majority of people think that if they are capable and talented they will become wealthy. But in
reality, the world is full of talented and capable people who never become rich because they are missing
a little something called

financial intelligence

. This essential aptitude allows people to understand important financial concepts such as investing,
accounting, etc. Unfortunately, most of us lack

financial intelligence

because our educational systems are set up to train us in many different subjects, some more useful
than others, but financial intelligence is not one of them. In school, children never learn how money
works, how to save, and how to invest. As a result, they become clueless adults who max out their credit
cards and spend their lives struggling to pay their debt. But this lack of financial training doesn’t apply to
today’s youth alone, but also to most highly educated adults who can’t stop making bad decisions with
their money. For instance, in an ideal society, politicians should be the brightest and best-educated
people. Unfortunately, more often than not they manage to bring countries on the verge of bankruptcy,
as most of them lack financial intelligence. But when it comes to handling money, ordinary people are
just as bad. For example, half of the workforce in the United States are without pensions and almost
eighty percent of the other half have insufficient pensions. It’s clear that we are poorly equipped when it
comes to financial knowledge and our society is to blame. However, it is up to each one of us to educate
ourselves on these matters. If we want to achieve long-term wealth and independence in a time of
perpetual economic change, we need to become more knowledgeable in terms of finances. Most people
receive little or no training in financial intelligence despite it being vital for achieving personal and
collective prosperity.

RICH DAD, POOR DAD CHAPTER #3: The building blocks of becoming wealthy are being realistic and
focusing on financial self-education.

Although you can begin your journey towards financial success at any point in your life, the earlier the
better. If, for example, you start focusing on your finances when you are in your 20 you are much more
likely to achieve wealth than if you start in your 30s. But, regardless of age, the first steps should always
consist of appraising your finances, establishing goals, and acquiring the necessary education. First and
foremost, you need to check your current financial state and be as objective as possible. What is the
average income that you can realistically expect from your current job and what will your future
expenses be? Can you handle them? Chances are that the new car that you’ve been drooling over might
not be affordable. After you have a clear picture of your present and future finances you will finally be
able to set realistic financial goals. For instance, you could say that you want to be able to afford that
new car in five years. The next step is to become more financially knowledgeable. Start to build your
financial intelligence by focusing on your greatest asset: your mind. There are many different ways to do
this but a particularly effective approach is to shift focus: invest your time and effort into learning
instead of focusing on what you earn. For instance, if you fear rejection, it might be a good idea to work
for a network marketing company. You might not earn a lot of money but you will gain a lot of self-
confidence and sales skills that will come in handy in the future. In your spare time, you can continue
working on improving your financial education. Sign up for finance classes and seminars, read magazines
and books on the topic and try to network with experts. If you gain sufficient knowledge, you will be
able to base your actions on the building blocks and increase your chances of becoming wealthy. The
building blocks of becoming rich are getting financial education and appraising your finances realistically.

RICH DAD, POOR DAD CHAPTER #4: You need to learn to take risks in order to become wealthy.

The definition of insanity is doing the same thing over and over and expecting to get different results. If
you want to change your financial state, you need to embrace this logic and start doing things
differently. A huge challenge will be learning how to become more comfortable with taking risks. The
great majority of financially successful individuals have taken many risks along the way, and they
learned how to manage their risks instead of fear them. When you put your money in savings accounts
and basic checking accounts you are not taking any risks. However, if you want to actually earn
something, you need to learn how to accept not always being balanced and safe with your finances.
Instead of playing it safe, you should try to invest in bonds or stocks, which are considered riskier than
your typical savings accounts but tend to generate much more revenue. It is a well-known fact that
stocks can produce a lot of wealth in a relatively short period of time. If, however, you are not keen on
committing yourself to the stock market, there are other types of investments that you can consider. For
instance, real estate or tax
lien certificates

are another great way of growing your wealth. With tax lien certificates, you can get an interest rate as
high as thirty percent. Of course, with a potential for a higher return come higher risks. It is worth
mentioning that when it comes to stocks there is always a slight chance to lose everything that you
invested. But, if you are not willing to take the risk, then you won’t make any big returns. So, it’s
important to remember that in order to make bigger income, you need to be willing to learn how to
manage bigger risks. In order to make more money, you need to be willing to take bigger risks.

RICH DAD, POOR DAD CHAPTER #5: Becoming wealthy can take a long time, so you need to keep
yourself motivated.

The journey to becoming wealthy can be long and trying. It’s very easy to become disheartened when
you hit an obstacle such as seeing the price of a stock you invested in suddenly fall. But if you want to
achieve your financial goals, you need to come to terms with these setbacks and find ways to stay
motivated. A great way to boost motivation is to make lists of “wants” and “don’t wants” for your
personal reference. For instance: “I don’t want to work in a cubicle for the rest of my life” or “I do not
want to end up like my parents”. You can reread these lists whenever you need a reminder of why you
took this path in the first place. Another effective way to stay motivated is to allocate some money for
your personal needs before you start paying your bills. Although this strategy might seem
counterintuitive, it will help you understand how much money you need to satisfy your personal needs
and your financial objectives. You shouldn’t neglect your personal desires, whether you want to buy a
vintage guitar, or changing your wardrobe regularly, or traveling the world, as these are the things that
will make you happy and keep you motivated. Of course, you shouldn’t go overboard and rack up lots of
credit card debt, but do think of yourself first. If paying the bills will prove to be difficult afterward, you
will be forced to find new ways to satisfy all your needs. This method will develop and sharpen your
financial self-discipline, which is a very important part of becoming a financially successful individual. If
you need some external inspiration, you can read the life stories of successful people such as Donald
Trump or Warren Buffett and find out what they did in order to become wealthy. Reading about other
people’s struggles and what they went through before finally achieving success will keep you motivated.
Staying motivated shouldn’t be too difficult, especially when you always keep your goals in mind, but
when it does, put these tips into practice. Because the road to wealth can be quite long, you must find
ways to keep yourself motivated.