Last Friday (Jan 4, 2007) morning I was at the Rich Dad Club here in Scottsdale. I got to sit in on a taping of Robert discussing various problems and predictions of 2008 with various guest speakers. There was a total of 4 tapings, 3 of them were about education and our educational system in America and another one was about the predictions for 2008.

I was not quick enough with my pen/paper to get the names of all the speakers, nor can give a good enough summary of each of their stories, but I want to outline a couple of things and make some key points about America’s educational system and how finical intelligence is completely left out.

If you have ever read any of Robert Kiyosaki’s Books, Rich Dad Poor Dad, you will more and more in this day and age a “secure job” is wishful thinking. So each of these 3 woman discussed their 3 very diverse backgrounds. One woman graduated with a teaching degree and worked for the educational system, but home schooled her children. Another woman grew up in the “ghetto” of Chicago and was the first of 14 children to a single parent to not only graduate high school, but also continue onto college and get her bachelor’s degree and masters. The last woman is currently a teacher in a private school for many of the “wealthier” families in this Scottsdale Area. Seeing these 3 woman speak about their background and discussing finical intelligence and how it plays a role with various children growing up as well as how financial intelligence is completely missing from our current educational program.

The idea of going to school, getting good grades, and landing a high paying successful “secure” job is a myth. If you look at my profession of the Information Technology area, most people will have change jobs once every 3 years. The baby boomer generation or the WWII generation of working for 1 large company for their life is far from what is going on in todays world. Investing into 401(k)’s and IRAs is a MUST for any young person in the work place due to a lack of pension and/or possibility of their “retirement funds” being “lost”, can any say Enron?

So sitting in on this discussion and reading various books like the 4 Hour Work Week, Where have all the Leaders Gone, and Crazy Busy you will see a pattern with all of these books that my generation needs to understand and DO something about it. The idea of this “golden retirement” is a pipe dream. Even now my parents generation is facing problems of “not being able to retire” due to various finical reasons. You can no longer have this warm fuzzy feeling that the government will help pay for your retirement. You need to learn finical education, our society has, on the average, about $8,000 in debt per PERSON! With more and more kids graduating from college with well over 6 figures in debt, how do you expect to get out. If you want to see how these business are eating people alive, add maxed out to your netflix, it’s a great documentary.

Okay sorry for that rant, but these woman focus on how they have brought in the game Cashflow and getting kids to see and understand passive income. This concept is very hard to understand for most due to the upbringing and knowledge we were taught while growing up. Robert said something yesterday that just hit me like a ton of bricks. Their are 2 types of investments, Capital Gains and Cashflow. Most people get sucked into 1 or the other, but you NEED both, this way they will balance out each other if something dramatic happens in the market place. Look at flipping houses, when their was a boom 2 or 3 years ago, it was so simple to sell a house, so the idea of getting a “capital gain” from that, was simple and easy. In today’s economy, selling a house today is like pulling teeth. You need the “cashflow” investments to help balance out or float your real estate properties until the market comes back. We are not teaching any time of “finical” knowledge in our educational systems. Even while getting my business minor, I was taught about debt and credit, but never looked at how you can turn a liablity into an asset. The academia world has no idea about “passive income” because they themselves either don’t know and focus on teaching you to go get a good job and get taxed out the @$$.

The last woman taught kids who either had a trust fund or parents who would give them lots of cash was a unique discussion. She bought the game Cashflow and had the students play it. After the students played it, and understand these concepts, she saw some of them taking that money they were normally get to spend on clothes, gadgets, insert expensive item here and take that money and invest it into cashflow opportunities. Knowing how much I was making in high school and even in college and spending it on “instant gratification” items, I was just throwing away the money. Seeing now that I can take that money and invest it into something that earns me a dividend or possibly a steady income is huge and what I am trying to do today.

The last taping was some predictions for 2008 and how the real estate market is continuing to go down with more foreclosures, but how the rich is still making money due to the knowledge and understanding of money. As Robert said you have 2 investments, cashflow and capital gains, the flippers are taking a bath due to not being able to sell as fast who were looking for that capital gains. The cashflow people who own apartments are making money now due to foreclosures and basically the last stop for people from living on the street. The world is getting smaller and a global market is here, you can invest in places like China where their is a lot of opportunity for capital gains due to the booming economy. When one place is having some hard times, like the US, their are other places around the world that are booming, where you can make money. Why do you think Warren Buffett is spending so much time in Asia?

So last Friday morning was a great eye opener and inspiration to help me focus on completion and get more of my ideas out into the world. There is plenty more that I learned and hear, but only so much I can blog about.

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