Thursday, July 4, 2013

Academic, Bureaucrat or Capitalist?

The famous Robert Kiyosaki recently published a superb book, "Why A Students Work for C Students (and B Students Work for the Government)." In it, he writes that the super-smart "A" students in school go on to become "academics" - the lawyers, doctors, professors, engineers and so forth. The "C" students - not always the most book-smart but often those who excel at sports, music or other creative endeavors, or are busy working at their part-time job - become the "capitalists" who open their own businesses or start buying rental properties. The "B" students go on to become members of the great government bureaucracy - from teachers and firefighters to folks who work at the EPA, DOD or DMV. Kiyosaki says that the A students go on to work for the C students; the business owner always has to hire a lawyer, for example.

This is certainly a simplification of the way life really is, and it tends to put vast populations of individuals into boxes. But it also has many truths, which I have seen played out time after time. Kiyosaki encourages the A and B students to become C students, and also encourages people to turn from "employee" to "investor."

Now that I have had time to really digest this book - again, it is an excellent book and I think everyone should read it - I realize that the path to being a "capitalist" and/or "investor" is not for everyone. Indeed, if our entire society went in this direction, it would be a disaster. We need a diverse population of A, B and C students to be a successful society that operates effectively.   

The key message of the book that I believe to be the most important is this: Our children are not presented the diverse choices that are available to them for the future. They continue to be taught to go to school, get good grades, get a good job at a big company with good benefits, sock money into the 401K and retire. But that is but one path. The world is changing. While this model may work for many, there are so many other choices out there. It takes financial education to know what the choices are and how they can be achieved.

When it comes to the simple fact of knowing that a person needs financial education - not just academic knowledge - there are people that "get it," and those that don't.  The ones that get it - who take the time to continue their learning and pass it on to the next generation - will be able to move from employee to investor, and set their children up to at least know that there are many choices available for his or her future. The rest - the majority - will stay where they are, and their children will follow the same path. This is not all bad. We need A and B students, they do honorable and worthy work, and we should not judge their choices any more than they should judge those of the C student.

Just know that the C student will have the edge. Take it for what it's worth.