How To Invest With NO MONEY Down: Turn $0 Into Infinite Returns -Robert Kiyosaki (Millennial Money)

Summary

In this episode of Millennial Money, Robert Kiyosaki, author of 'Rich Dad, Poor Dad,' discusses the importance of using other people's money (OPM) for investing, a strategy he believes requires intelligence and creativity. Kiyosaki highlights the power of mindset in overcoming financial challenges, explaining that poor people often claim 'I can't afford it,' while successful people find ways to raise capital. Sharing personal stories of business successes and failures, he encourages millennials to invest in what they love and avoid excuses, stressing that laziness is the real barrier to wealth.

Takeaways

• 📘 Robert Kiyosaki emphasizes using OPM (Other People's Money) for investments, saying it takes more intelligence to raise capital.
• 💰 Robert claims only lazy people use their own money, which often stems from a mindset that limits their financial success.
• 📚 Robert discusses the importance of financial education, noting that traditional schooling does not teach critical financial skills.
• 👨‍👩‍👦 Robert shares that his 'rich dad' taught him never to say 'I can't afford it,' a lesson that has shaped his financial decisions.
• 🏠 Robert’s first investment was an $18,000 condo in Maui, which he financed entirely with debt, making it an 'infinite return' deal.
• 🤔 He highlights the value of creativity and problem-solving when faced with financial challenges, which helped him thrive despite a lack of initial capital.
• 💡 A mindset shift from 'I can't afford it' to 'How can I afford it?' can open up new opportunities for financial success.
• 📉 Robert recalls a major failure in his business career, where a partner ran off with $100,000, but emphasizes learning from mistakes.
• 🌍 Robert advises millennials to invest in what they love, sharing that his passion for business, real estate, and precious metals drives his investments.
• 🧠 The importance of mindset is reiterated throughout the conversation, with Robert urging people to adopt an entrepreneurial and solution-oriented attitude toward money.

Q & A

Who is the host of the Millennial Money episode?

The host of the Millennial Money episode is Alexandra Gonzalez.

What new book did Robert Kiyosaki recently release?

Robert Kiyosaki recently released his new book titled 'Fake: Fake Money, Fake Teachers, Fake Assets.'

What does Robert Kiyosaki mean by 'Only lazy people use their own money'?

Robert Kiyosaki believes that it requires more intelligence and effort to raise capital using other people's money (OPM) rather than relying on one's own money. He considers it lazy to say 'I can't afford it' instead of figuring out how to raise the necessary capital.

How did Robert Kiyosaki's rich dad influence his mindset about money?

Robert's rich dad taught him never to say 'I can't afford it.' Instead, he encouraged Robert to figure out how to raise money or make things happen, which shaped Robert's proactive and entrepreneurial approach to finances.

What was Robert Kiyosaki’s first investment using OPM?

Robert Kiyosaki's first investment using OPM was a one-bedroom condominium in Maui that cost $18,000. He used 100% debt financing and paid $1,800 as a down payment, but he borrowed that money rather than using his own.

Why does Robert Kiyosaki criticize the mindset of saying 'I can't afford it'?

Robert Kiyosaki criticizes the 'I can't afford it' mindset because he believes it reflects a defeatist attitude. He argues that it is lazy to simply accept financial limitations, and that individuals should instead focus on learning how to raise money and think creatively.

What mistake did Robert Kiyosaki make in his surfer wallet business?

One of Robert Kiyosaki’s biggest mistakes in his surfer wallet business was trusting his CPA, Stanley, with a $100,000 check to solve an inventory issue. Stanley ran off with the money, leaving Robert with a significant financial loss.

What advice does Robert Kiyosaki give to millennials starting out in investing?

Robert Kiyosaki advises millennials to invest in what they love. He emphasizes that loving the asset or business will make investing more engaging and personally fulfilling.

What does Robert Kiyosaki compare a financial statement to?

Robert Kiyosaki compares a financial statement to a scorecard in a game like golf. He uses it as a way to measure success and progress in business and investing.

What is the main difference Robert Kiyosaki highlights between his poor dad and rich dad's financial mindsets?

Robert highlights that his poor dad focused on getting more education and job security, whereas his rich dad focused on learning how to raise capital and invest in assets. His rich dad encouraged a mindset of financial independence, while his poor dad stayed in a cycle of working for money.

Outlines

00:00

👋 Introduction to Millennial Money and Robert Kiyosaki

Alexandra Gonzalez introduces the episode of Millennial Money, featuring Robert Kiyosaki, renowned author of 'Rich Dad, Poor Dad'. Alexandra announces Robert's new book, 'Fake: Fake Money, Fake Teachers, Fake Assets', available via a link in the description. She shares that the episode will focus on how to invest using other people's money (OPM), a topic popular among viewers. Robert begins by reflecting on a key lesson from his 'Rich Dad'—that only lazy people use their own money, as it’s essential to learn how to raise capital instead.

05:00

💡 The Concept of OPM and Personal Responsibility

Robert discusses how he learned the importance of raising capital instead of relying on his own money, attributing this mindset to his rich dad. He contrasts this with his poor dad’s belief that financial struggles were inevitable due to having children. Robert expresses frustration with the mindset that limits possibilities, emphasizing that many people remain poor because they lack the will to find solutions. His rich dad encouraged a mindset of possibility, urging Robert to never say, 'I can’t afford it,' and instead to think creatively to overcome financial challenges.

10:03

🏠 First Investment and the Mindset of Using OPM

Robert recounts his first real estate deal, a $18,000 condo in Maui, which he financed entirely through debt. He explains how he convinced others to provide the capital by assuring them he would repay it, resulting in an infinite return on investment. Despite having the money to pay the down payment, Robert chose not to use his own funds, illustrating his belief that using other people's money allows for more creative and profitable ventures.

😲 The Challenge of Risk in Business Ventures

Robert shares a story about one of his biggest mistakes—launching a nylon and Velcro surfer wallet business that failed to sell initially. He and his partners were struggling financially, but an opportunity arose when they noticed a trend among joggers needing a place for their keys. This insight led them to create a shoe pocket, which became a major success after appearing in Playboy magazine. Despite the success, Robert faced financial challenges in managing inventory and eventually lost a significant amount of money when his CFO ran off with a $100,000 check.

📈 Advice for Millennials Starting Out

Robert advises millennials to invest in what they love, sharing his passion for business, real estate, and precious metals like gold and silver. He emphasizes the importance of understanding financial statements, likening them to a scorecard in a game. He criticizes the education system for failing to teach students about personal finance and stresses the value of being an entrepreneur and investor.

💡 Final Thoughts on OPM and the Excuse of 'I Can't Afford It'

Robert reiterates that the phrase 'I can’t afford it' is an excuse used by lazy people who don't want to figure out how to raise capital. He encourages a mindset of possibility and action, noting that it takes more intelligence and effort to raise money than to simply dismiss opportunities due to financial limitations. Robert believes that those who work harder to raise capital are ultimately more successful in their ventures.

🎉 Introducing the New Show: Weird Money

Alexandra concludes the episode by introducing a new show called 'Weird Money' hosted by Derek. Derek briefly introduces himself and expresses his excitement to discuss unusual and interesting aspects of the financial world on the Rich Dad YouTube channel. Alexandra reminds viewers to subscribe and hit the notification bell to stay updated on the new show.

Keywords

💡OPM (Other People's Money)

OPM stands for 'Other People's Money,' a core concept in the video, referring to the practice of using borrowed capital or investment funds from others to finance projects. Robert Kiyosaki emphasizes that using OPM requires creativity and intelligence, contrasting it with using one's own money, which he associates with laziness. In the script, Kiyosaki explains how he used OPM to fund his real estate investments, and how it is a smarter approach to building wealth.

💡Rich Dad, Poor Dad

"Rich Dad, Poor Dad" is Robert Kiyosaki's best-selling book, often referenced in the video as the foundation for his financial philosophy. The book contrasts the mindset of Kiyosaki's two father figures—his biological father (Poor Dad) and his mentor (Rich Dad)—to illustrate the different attitudes toward money, wealth-building, and financial education. The video connects the lessons from this book to the broader discussion of leveraging OPM and breaking free from a 'poor' mindset.

💡Mindset

Mindset is a central theme in the video, referring to the attitude and beliefs individuals hold about money, wealth, and opportunity. Kiyosaki discusses how a 'poor mindset'—which includes statements like 'I can't afford it'—keeps people trapped in financial struggles. In contrast, an 'open mindset' involves finding creative solutions and taking proactive steps, such as learning to raise capital through OPM. This shift in mindset is portrayed as key to financial success.

💡Raising Capital

Raising capital refers to the process of securing funds from investors or lenders to finance a business or investment. Kiyosaki explains that he often had to raise capital because he didn’t have enough money to fund his ventures. He views this skill as essential for wealth-building and contrasts it with the approach of using one’s own money, which he believes is less effective. This is illustrated through his personal experience with real estate and business ventures.

💡Laziness

Laziness, according to Kiyosaki, is a mental state that prevents people from taking control of their financial futures. He argues that those who rely on their own money or avoid taking financial risks are being lazy because they aren’t putting in the effort to learn how to raise capital or think creatively about wealth. In the script, he provocatively states, 'Only lazy people use their own money,' challenging the audience to adopt a more active and strategic approach.

💡Financial Education

Financial education, as discussed by Kiyosaki, is the knowledge and skills needed to understand money, investing, and wealth-building. He criticizes traditional schooling, particularly the way teachers prioritize job security and paychecks over entrepreneurship and financial freedom. This lack of financial education, Kiyosaki argues, contributes to the 'poor mindset' that many people have. He promotes self-education and seeking advice from wealthy individuals to gain the necessary skills.

💡Assets

Assets are resources that generate income or increase in value over time, such as real estate, businesses, or investments. In the video, Kiyosaki stresses the importance of investing in assets that are worth more than oneself. He shares the story of his first investment in a condo, where he used OPM to acquire a real estate asset that eventually generated a positive cash flow. Assets are portrayed as key to achieving financial independence.

💡Poor Mindset

The 'poor mindset' is characterized by limiting beliefs and negative attitudes toward money, such as saying 'I can't afford it.' Kiyosaki attributes this mindset to the way many people are raised, including his own 'Poor Dad,' who believed education and job security were the path to financial stability. In contrast, Kiyosaki's 'Rich Dad' encouraged him to develop a mindset focused on creating wealth through investments and raising capital. The poor mindset is depicted as a barrier to financial success.

💡Crowdfunding

Crowdfunding is a modern method of raising capital by collecting small amounts of money from a large number of people, typically via online platforms. Kiyosaki briefly mentions crowdfunding as a new tool available to young entrepreneurs and investors today. He contrasts it with the traditional methods of raising money that he had to learn in his early years, noting how technology has made accessing OPM more straightforward for today's generation.

💡Risk

Risk refers to the potential for loss or failure in any business or investment venture. Kiyosaki emphasizes that taking risks is an inevitable part of financial success. He shares a personal story about a failed business venture involving nylon wallets, highlighting how mistakes and risk-taking can lead to valuable learning experiences. Kiyosaki frames risk as a stepping stone to financial growth, rather than something to be avoided.

Highlights

Introduction to Millennial Money and Robert Kiyosaki's background as a best-selling author of 'Rich Dad, Poor Dad.'

Announcement of Robert Kiyosaki’s new book, 'Fake: Fake Money, Fake Teachers, Fake Assets.'

Introduction to the topic of using OPM (Other People's Money) to invest, emphasizing the importance of raising capital instead of relying on personal funds.

Kiyosaki’s controversial statement: 'Only lazy people use their own money,' explaining that using personal money lacks the creativity and intelligence required to raise funds.

Kiyosaki shares his upbringing, revealing that his rich dad taught him to never say 'I can’t afford it' and to instead figure out how to make things happen.

Discussion of the 'poor mindset' and how saying 'I can't afford it' leads to financial stagnation, contrasting with a growth-oriented mindset.

Robert’s personal story about how not having money early in his career forced him to learn how to raise capital and become resourceful.

The key lesson: Robert emphasizes the power of education and learning from wealthy individuals about how to succeed financially.

Kiyosaki’s first real estate deal in Maui, where he raised money for an $18,000 condominium through 100% debt financing, achieving an 'infinite return.'

Robert explains the difference between investing with personal funds versus using OPM, asserting that utilizing OPM shows financial intelligence and creativity.

Robert tells the story of his early failure with his surfer wallet business, highlighting the lessons learned from failure and the importance of thinking creatively in business.

A breakthrough moment: The creation of a 'shoe pocket' for joggers, leading to a successful marketing campaign that saved his struggling wallet business.

Robert's cautionary tale about trusting business partners, as he lost $100,000 when a business associate ran off with the money, demonstrating the importance of due diligence.

Advice to millennials: 'Invest in what you love,' whether it's business, real estate, or precious metals like gold and silver, as passion fuels success.

The mindset shift: Robert encourages people to stop saying 'I can't afford it,' explaining that it’s easier to raise capital than to accept defeat and give up on investing.

Preview of the new show 'Weird Money,' hosted by Derek, which will cover unconventional and bizarre aspects of finance, economics, and jobs.

Transcripts

- Hello, millennials and all generations.

This is Millennial Money, featuring Robert Kiyosaki.

I'm your host, Alexandra Gonzalez.

You know Robert as the best selling author

of the number one personal finance book of all time,

"Rich Dad, Poor Dad."

But I'm happy to announce that Robert just released

his brand new book,

"Fake: Fake Money, Fake Teachers, Fake Assets."

You can get your copy by following the link

in the description below.

This topic was highly requested by you guys.

So, due to popular demand, in today's Millennial Money,

we'll be covering how to invest with OPM

or other people's money.

Here's how Robert explains OPM.

- It was a long time ago - Yeah.

- when I first started Millennial Money,

and I made my usual wise-ass remark,

"Only lazy people use their own money."

And that's because I have spent

much of my life raising capital.

You know, today you have crowdfunding and all that stuff,

but the reason I had to learn to raise money was

because I had no money.

And so, if you read "Rich Dad, Poor Dad,"

in there my rich dad always said,

"Never say I can't afford it."

And it was my rich dad

and many of my teachers subsequent to that,

that said, "Lazy people always say I can't afford it.

"I don't have the money.

"That's why they're poor."

They have a poor mindset.

So, instead of figuring out how to raise money,

it's just really easy to be a loser,

and I call them losers.

It pisses them off because we all have the power,

if we wanted to, to not be poor

if we learned how to raise money.

So, I hear, you know, and the reason I get upset,

I still get hot like this.

(Alexandra laughs)

My poor dad, my PhD Father,

he always said to me, he says,

"You know, I'd be a rich man if I didn't have you kids."

And I said, "Well, you know, dad,

"it's not my fault you had kids."

You know, I mean,

"You know, I just can't afford it because I have kids."

And the more he said that, the angrier I got.

So my rich dad, at age nine,

he says, "Well, that's why your old man's poor,

"because he's lazy.

"He thinks his PhD is gonna carry him."

He says everybody can say, "I don't have money.

"I can't afford it."

He says, "That's why he's poor.

"He's lazy."

But my father kept going back to school, you know,

Stanford University, Chicago, Northwestern;

he never learned any of this stuff.

They still don't know it.

Because most teachers want a pay check, pension, and tenure.

They want job security.

So the mindset is different.

And that's what they teach the kids.

- Next, Robert tells us the number one phrase

that keeps people poor.

Now pause, I want you to leave a comment below

if you know what it is.

Don't cheat.

- So the reason I say only lazy people use their own money

is because it takes much more intelligence to raise capital.

And so I've never been able, ever since my rich dad,

since a little boy, my rich dad forbade me from

ever saying I can't afford it.

He says figure out how you can afford it.

"How can you do something?"

Figure out how you can do something.

So, over my lifetime, most of the projects I've started,

I've never had any money.

I like not having money,

because it forces me to think; I get creative.

I have to educate myself, I have to talk to rich guys.

"How'd you do this?

"How'd you do that?

"How you do that?"

And what has happened to me,

and I just turned 72,

I've never needed money.

Because if I need money, I figure out how to raise it.

So today you guys have crowdfunding and all that.

I mean, I don't know what that stuff is.

But it's easy to say, "I can't afford it."

All the poor people say, "I can't afford it."

All the poor people say, "Well, let's tax the rich."

All the poor people are saying,

"Well, give me a free education, free food, free schooling,

"free manicures, free pedicures."

There's laziness, my opinion.

- One of my favorite things that Robert teaches

is how your mindset can literally change everything.

If you have an open mindset, you can

really change your life.

So Robert explains how his mindset changed how he invests.

- So, you know, over my lifetime,

I've raised hundreds of millions of dollars.

And it's because I didn't have money as a young person

that I learned how to raise capital.

And it's really quite simple.

You have to find an asset

that's worth more than me, you know.

If they can't invest in me, because that's called slavery,

you know, by me, you know?

So what I do is, when I started off,

I write about it in "Fake,"

I started off looking for this

one little piece of real estate.

I found an excuse, you know,

this one bedroom, one bath condominium on the beach in Maui.

And I found an excuse for people to give me the money.

All I had to do is assure them I'd pay them back.

So my first deal was an infinite return deal.

I had no money in the deal because it was 100% debt.

It was an $18,000 condo.

You can't touch them for that much any more,

but the economy was bad.

So I buy this $18,000 condo; the guy wanted 10% down,

you know?

You don't need higher math.

10% of 18,000 is how much, sports fans?

1800 dollars.

I could've use my money, I had the money.

But that would be too easy.

- Robert tells us lazy people use their own money.

Let's find out exactly what he means by this.

- Only lazy people use their own money

and that's what really pissed off a lot of people out there.

Go, "You calling me lazy?"

I said, "Yes, I am."

Because you're the same type of person will say,

"I can't afford it.

"I can't do that."

That's the problem.

It's up here; it's a real estate between this ear

and that ear.

"I can't do that."

Most of my family say, "Oh, yeah, I can't afford it."

My father taught to say that; my mother taught to say that.

My rich dad said I should never say that.

Let me ask you this question.

You know, you work for the Rich Dad company.

How much of my money is in this company?

- Zero.

- Zero.

Zero.

- When using OPM, one question I had for Robert

was what happens if the deal goes wrong?

He answers by telling the story

of one of his biggest mistakes.

- So, the biggest mistake.

So, I was doing very well here.

This was 1973, I started buying my first deal.

And that was an $18,000 deal.

$1800 down, $25 a month.

Cash flow. - Cash flow.

- I was infinite.

And then I kept doing that, I had a lot of property.

And then I decided I go here.

So my first business was

a nylon and Velcro surfer wallet business.

And it didn't sell.

So you know, everybody knows what those wallets are today.

But back then this is 1974 or five.

Yeah, '75.

They didn't know what the wallets were.

So we're going broke really fast.

We bought 100,000 of these wallets from Korea.

We ship it to our warehouse in Long Island,

and we're borrowing money from our investors.

So we raised about $600,000;

I got this little goofy wallet business up.

So we're in serious trouble.

I owed my father about $200,000,

my rich dad was laughing at me.

We're going broke so quickly.

Because we couldn't move the wallets, a 100,000 of them.

They were sitting on this (murmurs) warehouse

on Long Island.

And nobody would buy them from us.

So then the good thing about stupidity, there it is,

makes you smarter.

So I started thinking; we started thinking.

Said what's wrong?

And I said, what was happening in the world at that time,

all the baby boomers are fat, so they had to start running.

So jogging was coming online, you know,

and nobody jogged before.

You know, so these guys are all jogging.

And then we're reading the paper;

we're sitting in Honolulu, going broke fast.

And we read the paper, this jogger

went to Golden Gate Park in San Francisco

and was jogging around the park.

And what the jogger did was

he had no place to put his car key.

So what did they do?

He puts it on the front tire of his car

and goes for a jog around the parks;

we're reading this newspaper.

And voila, when he comes back to his car,

the car wasn't there!

- Oh, gosh.

- So the guy says, "They stole my car!"

- Oh, my goodness.

- And so the question was,

on the headline of the newspaper article,

"What does a jogger do with their key?"

And so we sat there, said, "Oh, my God, a problem.

"A problem."

So with that, I designed the shoe pocket

and you can see this picture right here.

It's Playboy magazine.

I mean, she's nice looking young model with nothing on

but a shoe pocket.

(Alexandra laughs)

But anyway.

So we're going broke so fast by then.

But when that picture hit Playboy,

suddenly, we were geniuses.

And everybody started throwing their money at us.

And all this product, our wallets were selling;

our shoe pockets were selling.

Investors were happy.

And the sales went through the roof.

So we were extremely successful.

So we went from risk, stupid, smarter, successful.

But the problem was how do we finance our inventory?

Because the demand was worldwide,

and we couldn't keep up with demand.

So I borrowed another $100,000.

And I went to my CPA, my CFO, Stanley.

So I said, "Stanley, will this $100,000

"solve our inventory problem?"

He goes, "Yes, it will."

So I gave Stanley the check.

And he ran off with it.

- Oh, my goodness.

- I had no signed documentation;

I turned it over to him.

He said I owed him the money.

So that was one of my first, you know,

six figure, seven figure mistakes.

- This is another question

all of you flooded our comments with on YouTube,

and all of Robert's social media.

It's: what advice do you have for millennials

just starting out?

Watch what Robert says.

- Well, number one is investing;

invest in what you love.

I love business.

I love real estate.

I mean, I really love it; I own this building here.

And I love gold and silver.

So I invest in what I love.

Most people say, you know, do what you love,

but I'd rather invest in what I love.

But I love being an entrepreneur, I love investing.

It's like Shark Tank to me.

I'm always looking at new businesses, new deals.

It's just a game like this.

You know, when you look at the financial statement,

that's like your scorecard.

It's like your golf scorecard is your financial statement.

But as you know, our schools teach us

nothing about financial statements.

- Finally, we wrap up our discussion about OPM

with Robert's final words for those of you

that use the phrase, "I can't afford it"

as an excuse not to invest.

- But it goes back to the original question:

Why did I say only lazy people use their own money?

Because lazy people always say, "I can't afford it."

You know, "I can't do it."

It's easy to say that.

And that's why they're poor.

It's harder to go raise a million dollars

than to say, "I can't afford it."

- All right, guys, that's it for today.

But before you go, I wanted to let you know

of the new show we're launching, Weird Money.

And this is gonna be our host, Derek.

- Howdy, guys, I'm Derek.

I'm gonna be hosting Weird Money

on the Rich Dad YouTube channel,

and I look forward to talking to all of you

about the most bizarre and out of this world parts

of our financial institutions,

the economy, jobs, all that sort of stuff.

And thank you, Alex, for introducing me.

- Thanks, I'm really looking forward to it.

And well, guys, don't forget to subscribe

and hit the notification bell if you wanna be

notified on this new show.

Bye, guys, see you later.

(upbeat music)