Rich Dad, Poor Dad Author Robert Kiyosaki Warns Young People This Mindset Leads To A 'Deadly' Financial Trap: 'Being Young Is Great, Except It Can Be A Liability To You.'

In a 2018 YouTube video, “Rich Dad Poor Dad” author Robert Kiyosaki shared valuable insights about financial education for younger generations along with the common pitfalls they face. 

Kiyosaki emphasized the importance of recognizing the value of time, especially when young. 

“One of the biggest mistakes I still hear today from young people is, ‘I don’t have to worry ’cause I’m still young,’" he said. "That is death to most people. Eventually, you get old, and then you’re not young again.”

He highlighted that time is one of the most significant assets or liabilities in life. He shared his observations of friends who, despite earning well throughout their lives, ended up with nothing substantial. Their focus remained on immediate gratification, symbolized by material possessions and lifestyle, rather than long-term financial security and asset building.

“When you’re young, you’re just having a lot of fun and life’s exciting, you know, it’s new,” he said.

This excitement, while a natural part of youth, can become a double-edged sword. 

“Being young is great, except it can be a liability to you,” Kiyosaki said. This emphasizes the potential pitfalls of a carefree attitude toward financial planning and the urgency of cultivating financial literacy from a young age.

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Delving deeper into this idea, he explained the tendency among young people to chase immediate gratification and career aspirations without a long-term financial strategy. 

“So many people spend their time focusing here," he said. "They want to make a lot of money. … They say, oh, I want a career … or, I’m gonna start my own business.” This approach, while ambitious, often overlooks the importance of understanding different financial pathways.

Kiyosaki's book "Rich Dad's Cashflow Quadrant" categorizes financial paths into employee (E), small business/self-employed (S), big business (B) and professional investor (I). He stresses the value of aiming for the ‘I’ quadrant, which is about becoming a professional investor — a path he admits is the hardest but also where significant financial gains lie. 

“This is where the mega bucks are, and Kim and I are here,” he said, indicating the lucrative potential of this path.

He also identifies a critical error in young people’s approach: “The big mistake I see young people make is they focus here. … They want to do what they love.” 

While pursuing one’s passion is often glorified, Kiyosaki suggests that this can lead to financial vulnerabilities. In reality, achieving substantial financial success often requires stepping out of your comfort zone and learning about complex and sometimes unenjoyable aspects of finance.

Kiyosaki stressed the importance of investing in what you love rather than merely doing what you love. He differentiated between passion, which he described as “greedy,” and purpose, which serves people. His journey to becoming a professional investor was not driven by passion but by a purpose to achieve freedom and financial independence.

A critical aspect of Kiyosaki’s message was about risk and education. Higher risks require higher levels of education and dedication. For him, the journey to financial independence involved learning about taxes, debt, insurance and enduring tasks he disliked to achieve his goal of financial freedom. But it was worth it in the end.

“I’m making millions and millions," he said. "I make more in a day than many people make in a lifetime.” 

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