Rich Dad Poor Dad is a starting point for anyone looking to gain control of their financial future

Work for the Company 
(Salary)
Work for the Government
(Taxes)
Assets
BALANCE SHEET
Liabilities
Income
Expenses
INCOME STATEMENT
Work for the Bank
(Mortgage)

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Chapter Two: Lesson 2
68
As an employee who is also a homeowner, your working efforts 
are generally as follows:
1. You work for the company.
Employees make their business owner or the shareholders 
rich, not themselves. Your efforts and success will help 
provide for the owner’s success and retirement.
2. You work for the government.
The government takes its share from your paycheck before 
you even see it. By working harder, you simply increase the 
amount of taxes taken by the government. Most people 
work from January to May just for the government.
3. You work for the bank.
After taxes, your next largest expense is usually your 
mortgage and credit-card debt.
The problem with simply working harder is that each of these 
three levels takes a greater share of your increased efforts. You need to 
learn how to have your increased efforts benefit you and your family 
directly.
Once you have decided to concentrate on minding your own 
business—focusing your efforts on acquiring assets instead of a bigger 
paycheck—how do you set your goals? Most people must keep their 
job and rely on their wages to fund their acquisition of assets. 
As their assets grow, how do they measure the extent of their 
success? When does someone know that they are rich, that they
have wealth?
As well as having my own definitions for assets and liabilities,
I also have my own definition for wealth. Actually, I borrowed it from 
a man named R. Buckminster Fuller. Some call him a quack, and 
others call him a genius. Years ago he got architects buzzing because
he applied for a patent for something called a geodesic dome. But in 
the application, Fuller also said something about wealth. 

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It was pretty confusing at first, but after reading it, it began to make 
some sense: 
Wealth is a person’s ability to survive so many number of days 
forward—or, if I stopped working today, how long could I survive?
Unlike net worth—the difference between your assets and liabilities, 
which is often filled with a person’s expensive junk and opinions of what 
things are worth—this definition creates the possibility for developing 
a truly accurate measurement. I could now measure and know where I 
was in terms of my goal to become financially independent.
Although net worth often includes non-cash-producing assets, like 
stuff you bought that now sits in your garage, wealth measures how 
much money your money is making and, therefore, your financial 
survivability.
Wealth is the measure of the cash flow from the asset column 
compared with the expense column.
Let’s use an example. Let’s say I have cash flow from my asset 
column of $1,000 a month. And I have monthly expenses of $2,000. 
What is my wealth?
Let’s go back to Buckminster Fuller’s definition. Using his 
definition, how many days forward can I survive? Assuming a 30-day 
month, I have enough cash flow for half a month.
When I achieve $2,000 a month cash flow from my assets, then
I will be wealthy. 
So while I’m not yet rich, I am wealthy. I now have income 
generated from assets each month that fully cover my monthly 
expenses. If I want to increase my expenses, I first must increase my 
cash flow to maintain this level of wealth. Also note that it is at this 
point that I’m no longer dependent on my wages. I have focused on, 
and been successful in, building an asset column that has made me 
financially independent. If I quit my job today, I would be able to 
cover my monthly expenses with the cash flow from my assets.
My next goal would be to have the excess cash flow from my 
assets reinvested into the asset column. The more money that goes 
into my asset column, the more my asset column grows. The more 

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Chapter Two: Lesson 2
70
my assets grow, the more my cash flow grows. And as long as I keep my 
expenses less than the cash flow from these assets, I grow richer with 
more and more income from sources other than my physical labor.
As this reinvestment process continues, I am well on my way to 
becoming rich. Just remember this simple observation: