What Type Of Investor Do You Want To Become

My rich dad said, “There are investors who buy assets and there are investors who create assets. If you want to solve the 90/10 riddle for yourself, you need to be both types of investors.”

In the introduction, I told the story of rich dad, Mike and me walking along a beach looking at a very expensive piece of beach front real estate he had just purchased. You may recall me asking rich dad how he could afford such an expensive piece of real estate when my poor dad could not. Rich dad's reply was, “I can't afford this land either, but my business can.” All I could see was a piece of land with old abandoned cars, a building half falling down, lots of brush and debris, and a large “For Sale” sign sticking up from the middle of the property. At the age of 12, I could not see any business on this land, but my rich dad could. The business was being created in his head and that ability to create businesses in his head was the reason he would go on to be one of the richest men in Hawaii. In other words, rich dad solved his 90/10 riddle by creating assets that in turn

purchased other assets. That plan was not only rich dad's investment plan, it is the investment plan for most of the 10% who make 90% of the money, in the past, in the present, and into the future.

For those of you who read Rich Dad Poor Dad, you may recall the story of Ray Kroc saying to my friend's MBA class that McDonald's, the company he founded, was not in the business of hamburgers. Their business was the business of real estate. Again the formula is to create an asset that buys other assets and that formula is the reason why McDonald's owns the most expensive real estate in the world. It was all part of the plan. And that is why rich dad repeatedly said to me once he knew I was serious about becoming rich, “If you want to solve the 90/10 riddle for yourself, you need to be both types of investors. You need to be a person who knows how to create assets as well as a person who knows how to buy assets. The average investor is not generally aware of the different processes and is not good at either process of investing. The average investor usually does not even have a formally written plan.”

Much of the second half of this book is about how people create assets. Rich dad spent many hours with me teaching me the process on how a person takes an idea and turns it into a business that creates assets that buys assets. During one of these lessons with rich dad, he said, “Many people have ideas that could make them rich beyond their wildest dreams. The problem is, most people have never been taught how to put a business structure inside their ideas and so many of their ideas never take shape or stand on their own. If you want to be one of the 10% that makes 90% of the money, you will need to know how to build a business structure inside your creative ideas.” Much of the second half of this book is about what rich dad called the “B-I Triangle” which is the mental structure that can give life to your financial ideas. It is the power of the B-I Triangle that takes an idea and turns it into an asset.

Rich dad often said, “More than just knowing how to create assets that buy assets, one of the main reasons the richest of investors are able to become richer is because they know how to turn their ideas into millions and maybe even billions of dollars. The average investor may have excellent ideas, but they often lack the skills to turn their ideas into assets that buy assets.” The remainder of this book is dedicated to how ordinary people are able to turn their ideas into assets that buy assets.

While teaching me how to turn my ideas into assets, rich dad often said, “When you first set out to turn your ideas into your personal fortune, many people will say, ‘You can't do that. ' Always remember that nothing kills your great ideas more than people with small ideas and limited imaginations. ” Rich dad gave me two reasons he thought people tended to say, “You can't do that.”

1. They say “You can't do that” even if you are doing what they say you cannot do, not because you can't do it but because they can't do it.

Rich dad explained that the process of making a lot of money is a mental process more than a physical process.

One of rich dad's favorite quotes came from Einstein, which went, “Great spirits have often encountered violent opposition from mediocre minds. ” Commenting on Einstein's quote, rich dad said, “We all possess both a great spirit and a mediocre mind. The challenge in turning our ideas into a million dollar or even billion dollar asset is often the battle between our own great spirits and our own, often mediocre, minds.

When I explain the B-I Triangle, which is the business structure that gives life to business ideas and is explained in the second part of this book, some people become overwhelmed by the amount of knowledge required to make the B-I Triangle work for them. When that happens I often remind them of the battle between their great spirits and mediocre minds. Whenever a person's mediocre mind begins to oppose their own great spirits, I always remind them of what my rich dad said to me. He said, “There are many people with great ideas but very few people with great amounts of money. The reason the 90/10 rule holds true is because it does not take a great idea to become rich but it does take a great person behind the idea to become rich. You must be of strong spirit and strong in your convictions to turn your ideas into fortunes. Even if you understand the process via which your ideas can become millions even billions of dollars, always remember that great ideas only become great fortunes if the person behind the idea is also willing to be great. It is often difficult to keep going when everyone around you is saying, “You can't do it. ” You must have a very strong spirit to withstand the doubt of those around you. But your spirit must be even stronger when you are the person saying to yourself “You can't do that. ” This does not mean that you plough blindly on not listening to the good and bad ideas of your friends or yourself. Their thoughts and input should be listened to and often used when their ideas are better than yours. But at this moment, I am not talking to you about mere ideas or advice.

What I am talking to you about is more than just ideas. I am talking about your spirit and the will to go on even when filled with doubt and out of good ideas. No one can you tell you what you can or cannot do in your life. Only you can determine that. Your own greatness is often found at the end of the road, and when it comes to turning your ideas into money, there are many times when you come to the end of the road. The end of the road is when you are out of ideas, out of money, and filled with doubt. If you can find in yourself the spirit to go on, you will find out what it really takes to turn your ideas into great assets. Turning an idea into a great fortune is more a matter of human spirit rather than the power of the human mind. At the end of every road, the entrepreneur finds his or her spirit. Finding your entrepreneurial spirit and making it strong is more important than the idea or business you are developing. Once you find your entrepreneurial spirit, you will forever be able to take very ordinary ideas and turn them into extraordinary fortunes. Always remember the world is filled with people with great ideas and very few people with great fortunes.

The remainder of this book is dedicated to you finding your entrepreneurial spirit and developing your ability to turn ordinary ideas into extraordinary fortunes. Phase Two gives you insight into rich dad's different types of investors and allows you to choose the path that may be best for you. Phase Three analyzes rich dad's B-I Triangle and how it can provide the structure for you to make an asset out of your good idea.

Phase Four goes into the mind of the sophisticated investor and how he or she analyzes investments as well as the pathway of the ultimate investor who takes his or her idea and B-I Triangle and creates fortunes. The last phase is Phase Five, Giving It Back, the most important phase.