If millennials want to get ahead in life, they should punt on building a savings account and go into debt.
Such is the advice of Rich Dad, Poor Dad author Robert Kiyosaki, according to CNBC. “Savers are losers,” he says.
“The old rules were you go to school, you get a job, you work hard, you save money and you invest for the long term in the stock market,” Kiyosaki wrote in his new book, Second Chance: For Your Money, Your Life and Our World.
With low interest rates, savings won’t build wealth like they did 30 or 40 years ago.
Instead of earning 15 percent interest when Kiyosaki was young, millennials get a return on their savings account closer to one percent.
With loans around five percent, he says that debt is a better move.
Though he makes inaccurate claims about global growth rates and the wealth of the rich, Kiyosaki’s counter-intuitive advice doesn’t stand alone. “Don’t save money, make more” is a popular refrain across the internet.
To an extent, it’s insightful. Just as students take out loans in anticipation of a higher income and better life with a college degree, it might be better to eschew saving for spending that expands someone’s economic opportunity. Entrepreneurs do the same when they apply for a loan to open a new business.
The problem with giving that advice to everyone, however, is similar to the problem with telling everyone they should go to college, or start a business. Many graduates end up with an unmarketable degree and high debt, and, by some estimates, over 50 percent of small businesses fail within the first year.
Spending money to make money could work for some millennials, but others will be left with high debts and low incomes, with no savings to assuage the pain. A daring millennial might come out on top, gradually paying off that debt in the future with higher income, but individual results may vary.
Before taking out blinding amounts of debt, millennials should pause and ask themselves what their plan is to pay off the debt and establish economic independence.


simple! Man of few words!

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