On Robert Kiyosaki's Rich Dad Poor Dad II

We continue with the second part of our article series on Robert Kiyosaki's book Rich Dad Poor Dad.

"Investments come and go. Markets fluctuate high and low. Economies recover and collapse. The world presents us with opportunities of life at every moment, every day. However, we might overlook these as they are right there. As the world changes and technology advances, new ways to enhance your financial security will emerge. Instead of being stuck in the past, it is necessary to learn to embrace change."

Kiyosaki emphasizes how important flexibility and openness to new opportunities are here. We have seen time and again how irrational it is to exhibit conservative attitudes in the investment world. For example, many people who were quite biased against Bitcoin only watched as it went from a few cents to hundreds of thousands of dollars. Despite such an increase and even proving itself to be usable as a reserve asset, there are still many who remain hesitant and distrustful.

Those who board the train early

When we look at the evolution of humanity, we can say that we have a tendency to preserve and maintain our attitudes and behaviors, but on the other hand, we must not forget that humans are also creatures inclined to adapt to the changing conditions of the world. Being short in the Ice Age was an advantage; it was more sensible to fight in groups against the stronger Neanderthals, and fleeing when we encountered venomous animals like snakes was crucial for survival. Therefore, we must accept that every era has its own advantages and disadvantages and figure out how we can use these to our benefit. The way to achieve this is through research and self-improvement. This way, you can make opportunities more visible and see what others cannot. For example, the evolution of artificial intelligence and new generation technologies has started to come to the forefront today. When you look at how much coins related to artificial intelligence have increased compared to others, you can see how tremendous the gains of those who boarded the train early are. Of course, if they have sold and realized profits :)

"Financial intelligence is what turns risks into opportunities. Therefore, an investment that carries risk for one person may be less risky for another knowledgeable person. As long as you know what you are doing, it is not gambling. Great opportunities do not come before your eyes; they become visible to your mind. Most people who fail to accumulate wealth lack the financial education to recognize the opportunities that come their way."

The Importance of Risk Management

Although it is quite related to what I wrote above, we can see the difference between those who gamble in every cycle and those who educate themselves financially and are good at psychology and risk management. For example, the bottom level of Bitcoin at $15,479 in 2022 was the last point of collapse for some and quite risky, while for others it was a great opportunity. There were those who bought at that level, as well as those who thought it would go even lower and were waiting, even some who sold their coins. Those who saw the price drop to that point as an opportunity continued to buy, accompanying the market's rise. While some had shaky hands, others kept buying. The price could have gone even lower, but no one knows that. However, we can say that a person who knows what risk and portfolio management is would be prepared for this scenario. These individuals can take stop-loss trades, lower their average by making incremental purchases, or make a final purchase with the cash they set aside. We could list many more ways.

"This is a game. Sometimes you win, sometimes you learn (I think Kiyosaki especially didn't say "you lose" here )*. Don't forget to have fun. Some people never win because they are afraid of losing. That was already the reason why school felt meaningless to me. We are taught in school that making mistakes is bad, and we are punished when we make mistakes. However, we learn to walk by falling. If we never fall, we can never learn to walk. The same applies when riding a bicycle. I still carry the scars on my knees, but today I don't even think about what to do when I ride a bike. We experience the same while becoming rich. The main reason most people are not rich is their fear of losing. Winners are not afraid of losing. But losers are afraid. Making mistakes is part of the process of achieving success. Those who avoid making mistakes move further away from success."

I had explained in detail in my article titled "Developing Our Mindset with the Mistakes We Make in Crypto" why making mistakes and a person's perspective on mistakes is very important. If you have a goal of being intimately involved with financial markets, you must realize that you cannot know everything and that you will occasionally lose money, even your profits, and may have to start from scratch. Just as you are trying to take other people's money, others are also trying to take your money, which is the fundamental logic of the exchanges (. Instead of evaluating your mistakes as regrets and constantly complaining, it is crucial for your development to plan how you can learn from them and how you will avoid repeating them.

"Rich Dad was talking about the benefits of going bankrupt before turning 30. He said, 'You'll have time to recover.'"

The earlier, the better

According to Kiyosaki, the earlier you are introduced to financial markets, the more of an advantage you have. As I mentioned earlier, someone who meets the markets at the age of 20 will have 10 years of experience by the time they turn 30. In contrast, a person who meets them at 30 will have just begun. A decade of experience will enable the 20-year-old to see opportunities that can change their life after 30 and allow them to become wealthy.

Moreover, the fundamental logic here is actually to be able to learn from mistakes in a similar way and to be able to move on. It corresponds to what is called a "winning mentality". While a loser may become even more depressed and risk everything, a win-focused person starts to think about how they can recover again. There is a significant difference between losing everything at 25 and losing it at 40. In one case, you are just starting to build your life, while in the other, your risk exposure is much lower because, according to general norms, you will have a family to take care of, goals to achieve, and children whose futures you need to plan. On the other hand, a 25-year-old has a lot of time ahead of them for all of this. Based on all this, we can say that the earlier you start, the lower the risk exposure of your mistakes will be, and the more chances you will have to recover.

This article does not contain investment advice or recommendations. Every investment and trading action carries risks, and readers should conduct their own research when making decisions.