(upbeat music) – 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. – 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).