Real Estate: The Secret Weapon of the Rich

by Alexandria P. Anderson

It’s a fact of life that you will have to pay your taxes each year, and it’s equally inevitable that you’ll hear people complain about them. Those who are tired of grumbling about having to pay their own taxes will often grouse about how much money the rich manage to avoid paying. No matter how one looks at it, it seems unfair– those with less bear the greater part of the burden while the wealthy have lawyers working around the clock finding new ways for them to avoid paying their share. With this state of affairs, it’s no wonder that the lower and middle classes resent the rich.

Well, the fact is, no amount of grumbling and complaining is going to make the powers that be suddenly make things fair for you. This is because of the Golden Rule: “He who has the gold, makes the rules.” Chances are, they are going to make the rules in their favor. They’re going to keep all the good tax breaks to themselves. They are going to tell you there just isn’t enough money to go around, even as you watch so many people drive around in so many expensive cars and eat in so many posh restaurants. Even politicians who promise tax breaks to the downtrodden masses– even the ones who are sincere in their desire to help the average working stiff– are limited in their ability to affect the system.

Because this is the way our society works, you can either sit and feel sorry for yourself or you can take steps better your situation. The truth of the matter is that, if you know the secrets of the rich, you can get these same tax benefits that the rich enjoy.

In his Rich Dad book series, Robert Kiyosaki advocates figuring out what the rich do to be rich, and do that. Except that you don’t have to figure it out. He didn’t even have to figure it out, because he had a rich “dad” to tell him the secret of the rich: investing. Especially in real estate.

“One of the reasons I chose to work predominantly in the B and I quadrants are the tax advantages,” he says in his book, “Cash Flow Quadrant.” The cash flow quadrant, after which he named the book, is his rich dad’s diagram of the four different kinds of people, with respect to where they get their money and their philosophy about procuring money which, oddly enough, match up. In other words, people who are Employees have one set of values while the people who are Self-employed have another.

In Robert Kiyosaki’s opinion, the most money is in the business and investment quadrants, largely because these quadrants allow individuals to take advantage of more tax breaks.

You know the saying, “If you can’t beat ’em, join ’em.” That is good advice, especially if the guys you want to beat are the rich. It’s actually great news that they are getting so many tax breaks. That means that, when you become one of them, you will get those same tax breaks, IF you know how.

Here’s how. You become one of them by using investments to make your money multiply. You can do that while remaining also in the E and S quadrants, if you are well-paid, but Kiyosaki advises that you join the B quadrant, by building a business system that will essentially work on its own without much input from you. Then you can either keep it or sell it, but you must invest.

So, invest– invest in apartments, condos, vacation homes, whatever suits your fancy. This is the true, time-tested road to wealth.

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