FINANCIAL IQ BY ROBERT KIYOSAKI

Key Concepts of the Book

• Financial Intelligence Defined: Financial intelligence is the knowledge and ability to manage, invest, and grow money effectively, giving you more options and control over your financial destiny.
• The Five Core Financial IQs: Kiyosaki breaks financial mastery into five distinct and improvable areas:
• Making More Money: Measured by your ability to increase your income, often by solving problems and spotting opportunities.
• Protecting Your Money: Safeguarding your wealth from "predators" like excessive taxes, bankers' fees, and poor investment choices.
• Budgeting Your Money: Focusing on creating a budget surplus and treating savings/investments as a fixed expense ("Pay yourself first"), rather than simply cutting costs.
• Leveraging Your Money: Using debt and OPM (Other People's Money) strategically to acquire income-generating assets, not consumer liabilities.
• Improving Your Financial Information: Continuously educating yourself on financial trends, tax laws, and the specific rules of the assets you invest in, basing decisions on facts, not opinions.

• Assets vs. Liabilities: The central tenet of Kiyosaki's philosophy: assets put money in your pocket, while liabilities take money out. Financial IQ is measured by how effectively you acquire assets.
• Debt as a Tool: Not all debt is bad. Good debt is used to purchase income-producing assets (like investment real estate), while bad debt is used for depreciating consumer goods.
• Action Over Knowledge Alone: Knowledge is not enough; taking action and learning from both successes and failures is crucial for developing financial genius.
• Refuse to Live Below Your Means: Instead of merely cutting back when money is tight, Kiyosaki encourages increasing your means (income and assets) through enhanced financial intelligence.