One of the keys to being rich is having financial knowledge. This is what Rich Dad taught in Robert Kiyosaki’s book, “Rich Dad Poor Dad.”

So does wealth come automatically once you become financially literate?

Not necessarily and certainly not. Robert Kiyosaki believes that despite reaching a certain level of financial education, personal obstacles can prevent even the most financially educated people from reaching their financial goal. These people will continue to work full time, living paycheck to paycheck instead of living the life they dream of.

Robert Kiyosaki listed the top 6 personal obstacles to his financial success as

1. Fear

2. Cynicism

3. Sloth

4. Bad habits

5. Arrogance

6. Disappointment

1. Fear
The main reason 85% of the world struggles financially is fear: the fear of losing money. But fear is not the real problem here. The real issue is how you handle fear. Robert Kiyosaki explained.

Robert Kiyosaki understood from his rich dad that the main difference between the rich and the poor is how they handle the fear of losing money. Suffering a loss in finances, some would simply give up. Others will try to turn loss into victory.

As John D. Rockfeller said: “I always tried to turn every disaster into an opportunity.”
Winners are those who are inspired by failures. Losers are those defeated by failures. In short, the rich will continue to act despite fear.

Robert Kiyosaki commented that people are so afraid of losing money that they play it too safe and eventually fall short of financial success. If they have any cash, most people would go out and bother big houses, big cars, and other “selfish” toys. Or they went on long vacations, which they justified as they deserved, instead of investing.

If not, they invest all their money in balanced portfolios: in certificates of deposit, low-yielding bonds, mutual funds, and some individual stocks. Driven by fear, these are people who play not to lose. Most of us fall into this category. We want to protect our capital. We are low risk takers. Of course, a balanced portfolio is definitely much better than no portfolio at all. Seek security through diversity. It is important to have a financial security and comfort plan in the first place.

However, if you have any desire to get rich, you should focus and not diversify.
You should put many eggs in a few baskets instead of putting a few eggs in many, as Robert Kiyosaki recommends.

If the prospect of failure scares you, play it safe first. Continue holding your day job until you have accumulated enough money resources to buy bonds and mutuals. Check with your financial advisor or planner to see what your portfolio should be if necessary, and adjust accordingly as you go. You first work toward your safety and comfort before working toward your financial goal. Therefore, your journey towards your financial goal will be much slower and will take a long time.

However, if the prospect of failure has inspired you to keep fighting for your financial success, you may need to challenge yourself to change your financial habits.
As it says “No risk, no gain”. A higher return on investment is usually accompanied by a higher level of risk. If you want a high return on investment, you have to face a higher level of risk. Play it safe no more. You will need to increase your risk appetite and learn to take some calculated financial risks based on your financial education.

As Robert Kiyosaki says, “Increase your financial knowledge, and then learn to take some calculated financial risks. The more financial education you have, the more you can manage and minimize risk.”

Manage the risks well and the profit will follow, and you’ll be on the fast track to your financial goal.

In future articles, I’ll continue to describe the rest of the personal obstacles to financial success defined by Robert Kiyosaki.