Control over Your Destiny

According to Webster's, the word education comes from the Latin educo or educe, which means to draw out or lead out. By choosing to attend the U.S. Merchant Marine Academy in New York, I was choosing to have the sailor in me come out. By attending the U.S. Navy Flight School in Florida, I was choosing to have the pilot in me brought out. By deciding to follow in my rich dad's footsteps rather than my poor dad's, I was choosing to have the rich person in me come out.

In 1974, I had to make a decision as to which dad I would follow. I knew that if I followed my own dad's advice of “Go back to school, get your master's degree, and then get a secure job” I would wind up like him. I also knew that if I followed in my rich dad's footsteps, there were no guarantees as to where I would wind up. By 1974, I was old enough to know that rich dad's path had no guarantees. I could wind up broke and destitute just as well as wind up rich. By this time, I had seen many of rich dad's friends who had started on the journey with rich dad but had not made it to their destination. In 1974, I knew I had to make a choice between a guaranteed destiny or an uncertain destiny. As you know I chose the destiny that was uncertain.

My decision to choose an uncertain destiny—to build my own ark rather than build one for someone else—had little to do with the destination and everything to do with the process . . . the road to the destination. Many of us have heard the saying “The easy road becomes hard and the hard road becomes easy.” In 1974, I decided to take the hard road, the road without guar-antees. In 1974, the decision was easy . . . it was taking that first step that was hard. Five years later, in 1979, I had to make that decision again. Pulling myself up and out of a giant hole I had dug for myself was one of the most difficult things I have ever done, yet it was one of the best things I have ever done. I can honestly say that I have learned more from my failures than my suc-cesses . . . and I have learned more from my stupidity than my intelligence.

I recommend people keep their daytime job and start a part-time busi ness, or start investing in a small piece of income real estate, simply because it takes a few years to learn the basics. The journey out of the chicken coop only begins with the first step. There are many steps that follow.

If rich dad's prophecy comes true, and I believe it will, the next few years will be boom years in the stock market. It will be the big boom before the big bust. The baby boomers will be pouring money into their last chance for retirement. Happy days will be here again. But instead of acting like drunken sailors on shore leave during this period of financial euphoria, I suggest you begin to methodically build your ark. Invest your time and some money in education and in experience. Be willing to make mistakes but make sure they are small . . . and then learn from them. After learning from each mistake, congratulate yourself and step forward again. Although you may not necessarily be gaining financially, you will be gaining priceless experience, personal selfconfidence, more control over your destiny, and most importantly, you will be calling more and more for that rich person inside of you to come out.

Sir Isaac Newton once said, “I can measure the motion of celestial bod-ies but I cannot measure human folly.” He said this after personally losing a fortune during a period of financial euphoria known as the South Sea Bubble, a bubble that burst in 1720. Even a genius became a fool once he lost control of himself, his emotions, his excuses, his vision, his rules, his advisors, and his fortunes.

I am quite certain that once the stock market recovers and begins its climb, sometime around 2004 to 2007, people will once again forget the past and be heard once again saying, “This time it's different!” But sometime after 2008 to 2012, things really will be different. Things will be different because this time, the past will catch up with the future. So prepare yourself and your ark to do well during the good times and to do even better during the bad times. Study, read, attend classes, and practice as if your life depends upon your ability to invest—because it does. If you can do that, you will have called out the rich person inside you and made him or her the captain of your ark.

Both my dads were tough men. Maybe that is why I found the discipline at the academy and in the Marine Corps easy. Rich dad was especially tough on Mike and me when it came to money, business, and investing; after all, he was turning over his fortune to his son and he was training me to acquire my own fortune.

Warren Buffett is also tough on his children. His partner has this to say about how Buffett treats his kids: “Warren is just as tough on his children as he is on his employees. He doesn't believe that if you love somebody the way to do him good is to give him something he's not entitled to.”

Warren Buffett calls inherited wealth “food stamps for the rich.” He goes on to say, “All these people who think that food stamps are debilitating and lead to a cycle of poverty, they're the same ones who go out and want to leave a ton of money to their kids.”

When his son Howard ran for county commissioner in Omaha, voters falsely assumed that with his surname, his campaign would be well financed. That was not the case. Buffett senior explained: “I asked him to spell his name in lower case letters so that everyone would realize that he was the Buffett without the capital.”

The other day I was in a store buying some clothes. The clerk asked me what I did, to which I replied, “I'm an investor.”

Shaking my head, I replied by saying, “No it doesn't. In fact money has very little to do with investing. Like many other people, I started with nothing.” “But you went to a good school then, didn't you?”

“I went to a good school but what I learned had very little to do with investing or becoming rich,” I replied. “And besides, money does not make you rich.”

“So how did you become rich?” asked the clerk. “How did you find the money to invest?”

“I studied, I read a lot, I started small and made many mistakes, and I have good advisors and mentors. It's what I learned on the streets that made me rich,” I replied as I signed my credit card receipt.

“That sounds like a lot of work,” said the young man. “It is,” I replied. “But so is what you are doing.”

As you already know, rich dad never did finish school and, because of this, his speaking and writing skills were limited. Yet because he had to face the real world at the age of thirteen, his financial adversity caused him to develop his financial abilities and caused him to become one of the smartest persons I have ever known. When his son, Mike, and I get together these days, we continually discuss what we learned about business, investing, money, and life from his dad, my rich dad. We often comment, “Because he had no money he became rich. Because he had no education he became a genius. And because he had no security to fall back on, he found freedom.”

One of the more important words to rich dad was the word fiduciary. Webster's defines fiduciary as held in trust, generally referring to financial matters. Rich dad said, “Regardless whether you wind up rich or poor, I always want you to be a person people can trust. Your word is your bond. If you wind up as a poor man and find yourself flat broke, you and your family haven't eaten in days, and there is a $100 bill sitting on someone's desk, you are trustworthy enough to let it sit there. If you are poor, when you are at home, you are a person who can be trusted to protect your family and your wealth, al-lowing both to grow with safety. If you are poor, I want you to be generous with your time, your wealth, and your wisdom. If you wind up rich men, you are to do the same things as a trustworthy poor man. That is what I want you to grow up to be. Regardless whether you grow up to be rich or poor, I want you to grow up to be people who can be trusted.”

Inside each of you is a rich, poor, and middle-class person. Living in a free country means we all have the choice to decide which person we want to be. Start today by taking control of your education and your destiny.