Robert Kiyosaki: The Poor vs Rich Mindset (And 7 Ways To Change Yours)

Business woman working at a cafe

In a world where financial advice is as abundant as it is varied, Robert Kiyosaki’s perspective shines a stark light on the stark differences in mindset between the wealthy and the poor.

Discover: 6 Ways To Build Wealth in Less Than Five Years

More: How To Get $340 Per Year in Cash Back on Gas and Other Things You Already Buy

You may be familiar with his seminal work, “Rich Dad Poor Dad,” which challenges readers to examine their own financial beliefs and actions. He also champions the belief in two different and distinct mindsets, the rich and the poor, and explains the ways they affect our finances in an interview with Motivesity on YouTube.

But what does it really mean to think like the rich versus the poor? And more importantly, how can you change your mindset for the better? Here’s a breakdown of two mindsets Kiyosaki mentions as well as some of his tips for making that change.

Sponsored: Owe the IRS $10K or more? Schedule a FREE consultation to see if you qualify for tax relief.

Understanding the Mindsets

The Poor Mindset

People with a poor mindset often see life through the lens of scarcity. They believe resources are limited, and thus, life is about securing a small piece for themselves.

This mindset is characterized by a focus on saving money excessively, fearing debt and prioritizing job security over personal growth and investment opportunities.

The poor mindset is trapped in the “earn-and-spend” cycle, where money is seen as something to be earned from a job and then spent, rather than invested or used to generate more income.

The Rich Mindset

In contrast, the rich mindset is all about abundance, opportunity and leverage. Individuals with a wealthy mindset see money not as an end but as a means to create more value and wealth.

They are not afraid of debt; instead, they use it strategically to invest and expand their wealth. Failure is not a setback but a steppingstone to greater success.

They prioritize learning, growth and the creation of assets over the security of a paycheck.

Read: I’m a Multimillionaire — 3 Ways I Maintain a Frugal Lifestyle To Stay That Way

How To Change Your Mindset

The following are several of Kiyosaki’s tips to help you foster a richer mindset.

Question the Status Quo

Kiyosaki’s critique of traditional financial advice — get a job, save money, avoid debt — is rooted in this distinction between mindsets. Why save aggressively in a currency that is constantly being devalued through inflation? The rich understand that making money work for you, rather than working for money, is the key to wealth.

Recognize the Entrepreneur in You

Every person harbors the potential for poverty, middle-class comfort and wealth within them. The challenge lies in nurturing the wealthy part of yourself. This involves moving beyond the employee mindset that a steady paycheck is the ultimate financial goal.

Kiyosaki’s own journey underscores the importance of rejecting the paycheck not because it’s inherently bad, but because it often prevents the pursuit of greater, more fulfilling wealth-building activities.

Embrace Failure as a Steppingstone

Reflecting on his transition to entrepreneurship, Kiyosaki highlights how embracing failure and rejecting the safety net of a regular paycheck were pivotal.

The rich mindset understands that failure is an essential part of learning and growth. It’s about getting smarter and more resilient, not about clinging to security.

Understand the Power of Debt and Taxes

A key distinction between the rich and the poor mindset is the understanding and use of debt and taxes. While the poor aim to get out of debt and save money, the wealthy leverage debt to increase their assets and use tax laws to protect their wealth.

This strategic approach to finance is often what separates the wealthy from those who struggle financially.

Shift Your Focus to Creating Value

Wealthy individuals focus on creating value through businesses and investments rather than earning a salary.

This shift from being an employee to becoming an entrepreneur or investor is fundamental in the rich mindset. It’s about controlling your income, reducing your tax burden and making your money grow exponentially.

Adopt a Global Mindset

Kiyosaki stresses the importance of adaptability and a global perspective. The wealthy mindset is not confined to local opportunities or setbacks but looks for potential in a global context. This openness to change and new opportunities is a hallmark of thinking rich.

Educate Yourself Continuously

The world is changing rapidly, making continuous education a necessity for financial success. The rich mindset is characterized by an insatiable curiosity and a commitment to lifelong learning, ensuring that one’s financial strategies evolve with the times.

The Takeaway

Through understanding the differences between a rich and poor mindset, and in striving to adopt a rich mindset, you position yourself to break free from financial limitations and move towards true financial independence.

Becoming wealthy is not about how much money you have, but about having the mindset that enables you to grow and manage your wealth effectively.

Editor’s note: This article was produced via automated technology and then fine-tuned and verified for accuracy by a member of GOBankingRates’ editorial team.

More From GOBankingRates

This article originally appeared on GOBankingRates.com: Robert Kiyosaki: The Poor vs Rich Mindset (And 7 Ways To Change Yours)