I let you all know last week that I had the opportunity to attend a workshop hosted by the Rich Dad team. As promised, here is my review of the event!
For those who aren’t aware, about 10 years ago, Robert Kiyosaki wrote a book called Rich Dad, Poor Dad, detailing his experience growing up learning from his “Rich Dad” the principles of getting rich (I am currently reading this book). The book covers many topics, but has an emphasis on the process of acquiring assets to become rich. He has since created an organization named Rich Dad with the purpose of teaching people around the world the advanced principles of his theories and ideas. I recently attended a promotional workshop with the organization and have written a review of the experience for your enjoyment.
Getting Started
After completing the 52 minute drive to the conference center where the event was hosted, all participants were lined up and given nametags. Without a doubt, when they say the workshop starts at 6:00, they mean it starts at 6:00. They didn’t let us in the room one minute before.
As we summarily took our seats in the auditorium, one of the hosts played a short video featuring a message from Robert Kiyosaki giving a brief overview of some of the premises of the program. We were then informed that Robert had chosen to fly out “one of his best” to present to us that evening.
The content
Like I already mentioned, this was a promotional event, meaning that the purpose of the workshop was to sell you something. Specifically, they were pushing a course in Real Estate Investing. Now, I’ll be honest, I am hoping to get into real estate investments at some point in the future, but I’m not at that point in my financial life where that is possible. I need to first have my own personal real estate (which is yet to be purchased) in order before my plan will allow for such an expansion in investments.
If you aren’t quite ready for real estate investing, you may want to learn more about why you need a budget or other ways to make money.
The course itself, however, seemed like it could be worthwhile. However, it also seems that even the paid course is used as a platform to push other products. They were offering it at a price of $495 for two people and the course lasted 3 days for a total of nearly 30 hours of coursework. Coming from the standpoint of a student working on his master’s degree, that’s pretty cheap tuition, especially if the information is useful for increasing income in a dramatic fashion.
In addition to the course, those who signed up also gained access to a host of physical and online resources (these were available immediately to take home).
My issue
The one huge issue I took with the philosophy of the course and program was its reliance on debt. In my own life, my wife and I are working on our financial goals to finish paying off her student loan and pay for a house (not to mention building up our emergency fund). While the temptation to make more money faster with a little more risk is enticing to me, I would prefer to embark upon such an investing venture without the use of debt.
What I took away
All that being said, I did know more about the world of real estate investing when I left than when I arrived. In fact, I learned enough to realize that I had a lot left to learn, which I consider good news as it will, undoubtedly, inspire me to continue learning more on the subject. While I don’t plan on getting into these types of investments for some time, it was a good introduction to the process and I am glad that I attended the workshop.
If you are looking at attending one of these workshops, I would advise that you know what you are getting into and not act impulsively to purchase a program that isn’t right for you. There are a lot of risks involved in real estate investing and it is not for everyone. Also remember that no one program is right for everyone. This event is designed to teach you just enough to entice you to pay for the program.
If you are looking for more information on gaining wealth, you may wish to take a look at my review of The Millionaire Next Door.
Have you ever looked into real estate investments? What types of investments are you currently making (IRA’s, 401k’s, Peer to Peer lending services, etc.)? What are your feelings about using debt to fund investments?
Image courtesy of Rich Dad Education.
2 Comments on “A Review of the Rich Dad Workshop”
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My name is Branden. I am a high school teacher, a track coach, and a fitness and finance junkie who happens to think that life is pretty rough without viewing it through a spiritual lens. On this site, I hope to help you explore how to get into peak physical and financial shape while serving others, growing spiritually, and giving both time and money.
I went for Rich Dad workshop in Montreal just yesterday and sure, the speech person for 2 and half hours was selling the course for real estate investing. I am a real estate broker and want to learn what I don’t know, though I work in real estate for 10 years and have investment properties but any way I hoped I can learn something new may be.
What I learned right from the beginning the person who gave a speech knows little or nothing about real estate in Quebec and real estate law. That was upsetting. You want to pay 495 $ for the courses where they will teach you that the banks repossess properties here in Quebec and by law do not have a right to rent them? Not true. No such a law in Quebec. Banks just don’t have resources to manage rental properties; they make money by selling mortgages. I sold 2plexes, 3plexes, 4plexes -repossessions and they were fully or partly rented and the banks were collecting rents according the law. Sure if the bank repossesses a single family house they wouldn’t rent it because they don’t have management for that. They do not need to rent the properties; they need to make money from mortgages.
The speech person then gave little hints how to find opportunities to get good deals. Just a few, because more you can get only when you pay 496 and attend courses.
But those few are also very unsupported and misleading. Buy a wholesale property to renovate and flip, and sign a deed of sale not on your name but on the construction company name and then after the renovation you sell and make tax free profit. What? No company will agree to do that and no law exists here in Quebec to do that! And what is it wholesale property? We don’t have such properties in Quebec!
You want to learn how to buy pre foreclosures here in Quebec? Pay 495$ and learn! There are no such sales here! Only bank repossessed already!
FSBO- for sale by owners! They offer to use this opportunity to get a good deal! We have statistics in Greater Montreal Real estate board- 85 % properties of FSBO end up selling with real estate brokers. Initially they overpriced or the same market priced as listed with brokers. Cases what I know and my colleagues see every day in our practice when people buy directly from owners, of course exist. Most of the time people overpay or pay exact market price and owners just make more money. How can you know prices for similar properties in those locations, the same size and conditions what were sold recently? The sold prices are confidential for public. We are- real estate professionals have access to that info. The guy also mentioned that we don’t have in Quebec on internet a full system where to find properties. We have! In Quebec we are almost 18,000 brokers use a system tool Matrix where all the listed for sale properties published with all the info. And we pay to use this tool. We use other sites only for real estate licensed professionals to order all the info for deeds of sale for any property. This info is confidential for public too. You have to be a licensed real estate broker to access the info!
The speech guy then gave another hint- find a bargain deal, analyze. You save 6% commissions. How? Pay 495$ to find out! How do you know then it is a bargain? How can you know prices- comparables what were selling in the area if you don’t recommend to work with real estate brokers? May be at seminar they will offer crystal ball? Very risky investment then!
Other things what I learned from the guy who also said he is a real estate investor. Buy a property with hard money loan, simply- loan sharks. What and amazing advice! You are not qualified by bank to get mortgage with2,25% interest rate because you don’t have enough income and your credit cards are maxed out and from loan shark you get a mortgage with 12% interest. How on Earth you can pay it back with 12% interest if you cannot pay 2,25%? Ooo, you can make a lot of money just for flipping the house? Again back to finding a bargain.
The speech guy’s other brilliant idea – you want to buy a house but you don’t have money for down payment– let the owner to pay you together with a bank- we say the name for that transaction here in Quebec- balance of sale. To get a balance of sale from the seller to the buyer if they don’t know each other or the seller can sell to another buyer without dragging himself into this is very little to impossible. Forget about single family houses at all! The sellers will wait for the buyer with money then! Yes, we do some deals with balance of sale- most of the time rental properties with prices over a million when you are required to put 20% down payment minimum by law. Then for sure, you have 200,000 and 50,000 is just missing, we can negotiate for a year or 2 to repay. The guy gave an example as himself. He bought a property with 12% interest and 5 years of balance of sale, and 3 years later got a call from the lender asking to repay his money. The speech guy said – now he was in control and hung up the phone. He wants to use this money. Common! 12% interest? Be serious? You want to repay as fast as possible the balance of sale just do not pay such an interest!
The speech guy gave a wrong terminology what I found very wrong, people will mix up then what is what- buy commercial properties, for example. It took for me a while to understand that he is talking about residential rental properties after he showed a picture of his 6plex. Commercial property is a property with commercial purposes only- restaurants, stores, salons, etc. Can be mixed with residential though. First floor of multiplex is a store and other floors are residential rentals. Again he didn’t know that for only commercial property you have to put down minimum 40%. Why? Because the banks know that this is very risky investment. What if the restaurant has a 10 years lease with the land lord and then goes bankrupt for example? You lose 3-5 thousand dollars each month. If you are not experienced in real estate just to do that I found this advice very wrong.
Buy a multiplex and convert in condos! Those guys should check first with city of Montreal. We have here in Montreal ban for the last 5 years for conversion multiplexes to condos! Just a very few areas are still allowed and you have to check with the city very thoroughly.
Pay 495$ and find out that if you don’t have time to manage you rental property by yourself you can hire a landlord. No, you are the landlord and you can hire a janitor, but by law here in Québec if you have more than 8 apartments you need to have a janitor. But if you hire a janitor for your 5-6 plex then what profit will you have in your pocket?
So, in conclusion, that was a waste of my time and people from Rich Dad workshop who came to Montreal to teach real estate investment do not know anything about our market, our law, our taxation, our mortgages- they are different for American mortgages, -our refinancing of the houses and use a wrong terminology for Quebec housing and real estate.
Posted on 21 June, 2011 at 06:43.
Thanks to Yelena for the thorough review (as well as the original blog post)!
Posted on 13 August, 2011 at 04:00.