If you’ve ever read Robert Kiyosaki’s famous book “Rich Dad, Poor Dad” then you may already know much of what this article discusses. Basically, Mr. Kiyosaki lays out the two attitudes that his father and his best friend’s father had towards money.

Basically, Robert’s father was the “poor Dad” who worked hard his whole life in academia but was barely treading water when it came to finances. He always had to work hard without stopping just to keep up with his expenses. But, as a boy, Robert spent a lot of time with his friend’s father who was the “rich Dad” and who would dispense a great deal of financial wisdom to the young boys.

From his “rich Dad”, Mr. Kiyosaki learned about passive wealth. Instead of always sweating for money and being beholden to an employer, it is possible to create an income stream from investments that requires relatively little work.

The easiest way for the average person to get rich is by leveraging real estate to start these sorts of passive income streams. If you have credit, you can leverage a small amount of money toward buying a property that can be rented. The renters should be paying enough money to pay off the mortgage loan and pay off any extra expenses related to the property. Ideally, they should also provide a bit of extra cash for the trouble. As the mortgage gets dwindled down in size over the years, the portion of the property that the owner actually owns (the equity) will grow. Essentially, the renters will be paying off the loan and providing a small amount of income.

Once you have run one property successfully, it is much easier to become qualified for further loans from the bank. You get those loans and repeat, hopefully with more expensive properties. While the income might not be much initially, if you have several properties not only will your income grow but the amount that you are gaining in equity will grow. Although it may take 15 or more years, sooner or later, the average investor will own outright the property instead of paying the loan. At that point the vast majority of the money that the renters are paying will be income, because expenses will be limited to insurance, taxes and upkeep.

Obviously, the Rich Dad strategy for getting wealthy isn’t one that you can do overnight. But if you look at how many people have become rich through real estate, it is one of the safest and most reliable ways of getting wealthy if you are only willing to have the patience.

Don’t fall into the trap of taking out a large mortgage so that you can have a house that everyone will envy. That is the Poor Dad way of thinking. The Rich Dad would rather live in a trailer so that his own expenses are minimal and have 5 houses that other people are paying for. Perhaps the Poor Dad will live better today, but it is the Rich Dad who will live better tomorrow.

Written for Richbitchitch.com by Rick Hyland