All language subtitles for kiyosaki debt

So as

far as the subject of debt,

there's good debt

and bad debt.

Again,

it goes back to the

financial statement

income expense,

asset liability.

So debt falls in here.

Anybody says

I'm going to buy a house

and says my house is an asset.

That's not true.

Your house is a liability.

Same as if you have a car.

A car is a liability.

So when you look at

the average person,

they have a job.

Money comes in here.

They pay for their house

and the money goes to a bank.

So it's not an asset

because the cash is flying

flowing out.

So it's a liability.

So the definition

of liability,

does it

take money from your pocket

and for an asset?

Does it put money

in your pocket?

So when I

have a rental property here,

it puts money in my pocket.

So if I live in a house,

it's a liability

because even if I have

no debt on it,

I still have taxes,

depreciation, repairs

and upkeep, insurance

and all this.

When I rent a property,

I've done a good job

buying it and structuring it.

Every month

it sends me money.

I had a little

one bedroom condo

and it put 25 bucks

in my pocket.

This was good debt,

but debt also

went out and paid.

But it also put

$25 in my pocket.

So net net,

I was making money

from my little house.

But all of this

comes from debt.

So this is good debt.

And what makes a good debt

is the

two most important words,

cash flow.

I'm borrowing money

from here.

It's coming here

and going this way.

So the debt is putting money

in my pocket.

And bad debt is taking money

from my pocket.

The problem is,

if you're going to use that,

you've got to be much smarter

than this person here.

You've got to be very,

very smart.

That's why

I took real estate classes

when I was 25.

I've never stopped

taking real estate classes

because you buy a

piece of real estate

and you make a mistake.

This turns into a liability

if the renter leaves the place

This goes here that fast

and the cash flows that way,

it's going out of my pocket.

So it has nothing to

do with real estate,

Nothing to do with a car.

Nothing to do with student loan.

It has to do with these

two words here.

So good debt, again, is debt

when I borrow for this

and it puts money

in my pocket.

If I had a car

and I borrowed money for it

and somebody rented for me

as an Uber driver

or something,

and it put money in my pocket,

it would be an asset.

My wife and I have a boat

and, you know,

most boats lose money,

but our boat makes money

because it's in a charter.

You know, people

rent my boat all the time.

So it's nothing to do,

whether it's a boat, student

loan debt,

a house, a car or whatever.

It has to do with these two

words here,

as most of the time,

you know,

you've had

accounting classes.

They don't talk

much about this, do they?

This is something

they never mentioned to me

in college.

If the cash is flowing

into your income

statement, into your pocket,

it's an asset.

It's good debt.

But if it's taking money

from your pocket, it's

bad about that.

That's good Debt and bad.

The comments of that,

I think just like Trump,

you know

how to apply

the rules of debt.

And he calls himself

the king of debt. Right.

If you're going

to be successful,

like whether you're

an employee or entrepreneur,

you've got to control

the direction

of your cash flow.

So like most people here

we've talked about earlier,

they got a job

and the cash flows out here

goes to the government.

It's called taxes.

Trump doesn't do this.

I don't do this legally.

The reason is because

we're entrepreneurs,

not employees.

Employees, as have

this entrepreneurs taught

because it's a type of asset.

So what would you like to say

to the young millennials

listening to this?

I'd say,

Don't be afraid of debt.

And if you know

how to use it, use it.

Good.

That puts

money in your pocket.

Could a credit card

be good debt?

Boy, just depends

what you spend the money

on, right?

So if you spent it on

something that's

going to produce

income for you like an asset,

then it's good that.

But if you spend it

on, let's say,

a jacket

that you wanted

from Burberry,

then it's not first property.

There.

It was in

Maui, Hawaii, in the 1970s.

I bought it

with a credit card. Wow.

Property was $18,000.

My first.

But I've taken several

real estate classes

and so I knew

what to look for.

I found this one property

took a long time.

When I found that

I just broke out

my credit card and bought it

and I put $25 in my pocket

and went from

this little dinky

little thing.

This was years ago.

$25.

It was good debt.

I wish I never sold it.

I don't know.

It was a big mistake

to sell it

because today it's

probably worth

four or 500,000.

And that's a whole

nother story.

That's why

I don't flip properties,

you know,

I don't like to

do that stuff.

So anything else?

So good. Debt.

What money in your pocket?

Bad debt.

What takes money

out of your pocket?

That's all there is. Yeah.