Powerful money lesson
THE AUTHORS of the bestseller, Rich Dad, Poor Dad, give the example of a rich father’s lesson for two young boys. Rich dad hires Robert and Michael to work for three hours each Saturday for 10 cents per hour, a substandard wage for a menial task, dusting the merchandise in an area that is perpetually dusty. However, they would have cash in hand to buy comics. They agree.
After one month, they become disgruntled and frustrated. Family and friends urge them to revolt – at least, they deserve a raise. When they meet Rich Dad, Robert runs off at the mouth at how Rich Dad wants all the money for himself, is not teaching him anything and is not taking care of his employees.
Robert highlighted his sacrifice in giving up his Saturday softball games; he demands to be treated better, and to be respected. He describes Rich Dad as a cheap employer, exploiting his workers. Rich Dad’s instructive response was that Robert had progressed very far as he sounded like most of his employees after just one month.
Rich Dad also pointed out that it was not necessary to talk to someone for them to learn on the job. Tutoring and lecturing was a technique common to the school environment. Life does not teach one by talking. Life tends to push people around, each push being a wake-up call to learn a particular lesson.
If nothing is learnt from the push, one may tend to push back . . . at the wrong thing or person – say, the employer, the job, or members of the household. On the other hand, if you do learn, then you become wiser and wealthier instead of just hoping for some big break in life to solve all your problems. In the job situation, people who do not learn the lesson tend to end up living a safe and boring life, working hard – afraid to try a different approach to solving their frustrations.
Rich Dad also commended the boys for asking about how to make money. No other employee had ever done that. The others asked for a job and a pay cheque. They may even get a second job – working harder and longer.
Rich Dad stressed that the job was not as important as the worker’s mind. The workers needed to change themselves instead of focusing on changing their circumstances. The most important thing that each worker must do is to think and look for real solutions.
Rich Dad then took a startling tact. He offered the boys an increase in pay of 25 cent per hour. They are so surprised that they hesitated. And through a continuing offer and stunned hesitation process, Rich Dad moved his offer from 25 cents to $1 to $2 to $5. The $5 rate exceeded even what adults earned at that time. Somehow, the boys got the point. They must not be willing to be slave at any cost.
Rich Dad’s most shocking move was then to ask the boys to work for nothing. It is during this no-pay period that the lesson finally sinks home. These boys will not be a slave to the job. In fact, they begin to enjoy their work. Then with some prodding they discovered a money-making idea – establishing a library for used comics. They set up an operation with employees which netted them over $9 weekly.
The crux of the lesson is that through seeing what others never did, the boys were able to establish an operation that could earn them money even when they were not present. They were making more money without “working” for it.
• Louise Fairsave is a personal financial management adviser, providing practical advice on money and estate matters. Her advice is general in nature; readers should seek advice about their specific circumstances.