Rich Dad, Poor Dad Chapter 2 - The Rich Don't Work For Money Part 1

Rich Dad Poor Dad is a book written by American businessman, author and investor Robert Kiyosaki in 2000. It advocates financial independence and building wealth through value investing, real estate investing, starting and owning businesses, as well as increasing one's financial intelligence to improve one's business and financial aptitude. Read the first chapter chapter here

"Dad, Can You Tell Me How to Get Rich?"

My dad put down the evening paper. "Why do you want to get rich, son?"

"Because today Jimmy's mom drove up in their new Cadillac, and they were going to their beach house for the weekend. He took three of his friends, but Mike and I weren't invited. They told us we weren't invited because we were `poor kids'."


"They did?" my dad asked incredulously.

"Yeah, they did." I replied in a hurt tone.

My dad silently shook his head, pushed his glasses up the bridge of his nose and went back to reading the paper. I stood waiting for an answer.

The year was 1956. I was 9 years old. By some twist of fate, I attended the same public school where the rich people sent their kids. We were primarily a sugar plantation town. The managers of the plantation and the other affluent people of the town, such as doctors, business owners, and bankers, sent their children to this school, grades 1 to 6. After grade 6, their children were generally sent off to private schools. Because my family lived on one side of the street, I went to this school. Had I lived on the other side of the street, I would have gone to a different school, with kids from families more like mine. After grade 6,these kids and I would go on to the public intermediate and high school. There was no private school for them or for me.

My dad finally put down the paper. I could tell he was thinking.

"Well, son," he began slowly. "If you want to be rich, you have to learn to make money."

"How do I make money?" I asked.

"Well, use your head, son," he said, smiling. Which really meant, "That's all I'm going to tell you," or "I don't know the answer, so don't embarrass me."

A Partnership Is Formed
The next morning, I told my best friend, Mike, what my dad had said. As best I could tell, Mike and I were the only poor kids in this school. Mike was like me in that he was in this school by a twist of fate. Someone had drawn a jog in the line for the school district, and we wound up in school with the rich kids. We weren't really poor, but we felt as if we were because all the other boys had new baseball gloves, new bicycles, new everything.

Mom and dad provided us with the basics, like food, shelter, clothes, But that was about it. My dad used to say, "If you want something, work for it." We wanted things, but there was not much work available for 9 year-old boys.

"So what do we do to make money?" Mike asked.

"I don't know," I said. "But do you want to be my partner?"

He agreed and so on that Saturday morning, Mike became my first business partner. We spent all morning coming up with ideas on how to make money. Occasionally we talked about all the "cool guys" at Jimmy's beach house having fun. It hurt a little, but that hurt was good, for it inspired us to keep thinking of a way to make money. Finally, that afternoon, a bolt of lightning came through our heads. It was an idea Mike had gotten from a science book he had read. Excitedly, we shook hands, and the partnership now had a business.

For the next several weeks, Mike and I ran around our neighbourhood, knocking on doors and asking our neighbours if they would save their toothpaste tubes for us. With puzzled looks, most adults consented with a smile. Some asked us what we were doing. To which we replied, "We can't tell you. It's a business secret."
My mom grew distressed as the weeks wore on. We had selected a site next to her washing machine as the place we would stockpile our raw materials. In a brown cardboard box that one time held catsup bottles, our little pile of used toothpaste tubes began to grow.

Finally my mom put her foot down. The sight of her neighbours', messy, crumpled used toothpaste tubes had gotten to her. "What are you boys doing?" she asked. "And I don't want to hear again that it's a business secret. Do something with this mess or I'm going to throw it out."

Mike and I pleaded and begged, explaining that we would soon have enough and then we would begin production. We informed her that we were waiting on a couple of neighbours to finish using up their toothpaste so we could have their tubes. Mom granted us a one-week extension.

The date to begin production was moved up. The pressure was on. My first partnership was already being threatened with an eviction notice from our warehouse space by my own mom. It became Mike's job to tell the neighbours to quickly use up their toothpaste, saying their dentist wanted them to brush more often anyway. I began to put together the production line.

One day my dad drove up with a friend to see two 9-year-old boys . in the driveway with a production line operating at full speed. There was fine white powder everywhere. On a long table were small milk cartons from school, and our family's hibachi grill was glowing with red hot coals at maximum heat.

Dad walked up cautiously, having to park the car at the base of the driveway, since the production line blocked the carport. As he and his friend got closer, they saw a steel pot sitting on top of the coals, with the toothpaste tubes being melted down. In those days, toothpaste did not come in plastic tubes. The tubes were made of lead. So once the paint was burned off, the tubes were dropped in the small steel pot, melted until they became liquid, and with my mom's pot holders we were pouring the lead through a small hole in the top of the milk cartons.

The milk cartons were filled with plaster-of-Paris. The white powder everywhere was the plaster before we mixed it with water. In my haste, I had knocked the bag over, and the entire area look like it had been hit by a snowstorm. The milk cartons were the outer containers for plaster-of-Paris molds.

My dad and his friend watched as we carefully poured the molten lead through a small hole in the top of the plaster-of-Paris cube.

"Careful," my dad said.

I nodded without looking up.

Finally, once the pouring was through, I put the steel pot down and smiled at my dad.

"What are you boys doing?" he asked with a cautious smile.

"We're doing what you told me to do. We're going to be rich," I said.

"Yup," said Mike, grinning and nodding his head. "We're partners."

"And what is in those plaster molds?" dad asked.

"Watch," I said. "This should be a good batch."

With a small hammer, I tapped at the seal that divided the cube in half. Cautiously, I pulled up the top half of the plaster mold and a lead nickel fell out."
"Oh, my God!" my dad said. "You're casting nickels out of lead."

"That's right," Mike said. "We doing as you told us to do. We're making money."

My dad's friend turned and burst into laughter. My dad smiled and shook his head. Along with a fire and a box of spent toothpaste tubes, in front of him were two little boys covered with white dust and smiling from ear to ear.

He asked us to put everything down and sit with him on the front step of our house. With a smile, he gently explained what the word "counterfeiting" meant.
Our dreams were dashed. "You mean this is illegal?" asked Mike in a quivering voice.

"Let them go," my dad's friend said. "They might be developing a natural talent."

My dad glared at him.

"Yes, it is illegal," my dad said gently. "But you boys have shown great creativity and original thought. Keep going. I'm really proud of you!"

Disappointed, Mike and I sat in silence for about twenty minutes before we began cleaning up our mess. The business was over on opening day. Sweeping the powder up, I looked at Mike and said, "I guess Jimmy and his friends are right. We are poor."

My father was just leaving as I said that. "Boys," he said. "You're only poor if you give up. The most important thing is that you did something. Most people only talk and dream of getting rich. You've done something. I'm very proud of the two of you. I will say it again.

Keep going. Don't quit."

Mike and I stood there in silence. They were nice words, but we still did not know what to do.

"So how come you're not rich, dad?" I asked.

"Because I chose to be a schoolteacher. Schoolteachers really don't think about being rich. We just like to teach. I wish I could help you, but I really don't know how to make money."

Mike and I turned and continued our clean up.

"I know," said my dad. "If you boys want to learn how to be rich, don't ask me. Talk to your dad, Mike."

"My dad?" asked Mike with a scrunched up face.

"Yeah, your dad," repeated my dad with a smile. "Your dad and I have the same banker, and he raves about your father. He's told me several times that your father is brilliant when it comes to making money."

"My dad?" Mike asked again in disbelief. "Then how come we don't have a nice car and a nice house like the rich kids at school?"

"A nice car and a nice house does not necessarily mean you're rich or you know how to make money," my dad replied. "Jimmy's dad works for the sugar plantation. He's not much different from me. He works for a company, and I work for the government. The company buys the car for him. The sugar company is in financial trouble, and Jimmy's dad may soon have nothing. Your dad is different Mike. He seems to be building an empire, and I suspect in a few years he will be a very rich man."

With that, Mike and I got excited again. With new vigor, we began cleaning up the mess caused by our now defunct first business. As we were cleaning, we made plans on how and when to talk to Mike's dad. The problem was that Mike's dad worked long hours and often did not come home until late. His father owned warehouses, a construction company, a chain of stores, and three restaurants. It was the restaurants that kept him out late.

Mike caught the bus home after we had finished cleaning up. He was going to talk to his dad when he got home that night and ask him if he would teach us how to become rich. Mike promised to call as soon as he had talked to his dad, even if it was late.

The phone rang at 8:30 p.m.

"OK," I said. "Next Saturday." And put the phone down. Mike's dad had agreed to meet with Mike and me.

At 7:30 Saturday morning, I caught the bus to the poor side of town.


Continue to  Chapter 2 - Part 2

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