Friday, March 24th, 2017

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Who’s Getting Rich Off Rich Dad?

So have you ever been to one of those hotel real estate investing seminars over an evening or weekend?

No, not your local REIA or Meetup group.  I mean the ones we see advertised all the time in newspapers, late night TV or now even Facebook actually:

“Free Home Buyer Seminar!”
“Real Estate Secrets Revealed!”…

.

BEHIND CLOSED DOORS: “Real Estate Secrets Revealed!” (…Really???)

So Vena Jones-Cox recently pointed me to this video from CBC (Canada) – a hidden camera expose’ on Robert Kiyosaki’s traveling Rich Dad seminars.  And while I’ve had longstanding respect for the book Rich Dad, Poor Dad – mostly due to its key place in my early REI career – this scathing video actually pulls the curtain back on a number of alarming shenanigans apparently going on behind closed doors.  Things like…

  • RK’s seminars are not actually his own – they’re run by Russ Whitney’s organization, which just licenses and leverages RK’s name brand…
  • During the interview RK ends up seeming rather embarrassed himself at what he hears is going on…but also doesn’t seem willing to take responsibility for what’s being done under his name…
  • People are consistently being seduced into raising their credit card limits right there at the seminar, then systematically enticed to “invest” their new credit on even more training…to the tune of multi-multi-thousands of dollars…training that sadly has a reputation for being questionable at best…
  • We see people belittled and humiliated if they raise objections…and even thrown out by security…

I actually watched the whole shebang this afternoon, mouth wide open. And frankly I found myself feeling simultaneously disgusted and kind of sorry for RK.  Weird mix, I know.

Whether or not you have the 22 minutes available to watch the video, I’m betting you still have an opinion on this – maybe even some experience of your own you can share.

And I’d really love to hear how you feel about this one…

Why Rich Dad Still Has a Warm Place in My Heart…

The fact is I first got started in real estate investing because of the book, Rich Dad, Poor Dad.  I feel I owe much of who I am today to the invaluable lessons I learned from reading that book – and I still recommend it to people.

But I now recommend it with two caveats:

  1. I know believe his sacred cow “good debt vs bad debt” philosophy is a complete myth
  2. And watch out for the seminars.

While starting and running our local REIA group for 6 years, I came across more than a few bruised and battered newbie investors, fresh off having wasted tens of thousands of dollars on training that was basically crap.  There’s just no other way to say it.

And I quickly learned that, while RK’s first book (and maybe his second…maybe even his third) were great eye-openers and thought stimulators, the seminars that follow are apparently little more than machines designed to suck as much money out of attendees as possible…for as long as they can dupe them into it.

Now I don’t say this lightly.  This comes from literally years of hearing this from investors who’ve been through their program to some level.  I know a couple folks who “invested” upwards of $30,000 with them on “training”, only to come to one of our Saturday Workshops and proclaim through teary eyes they just learned more from us than their entire $30,000 bought them from Rich Dad and/or Whitney.

How to NOT Get Taken in by Real Estate Seminars

Now let me be clear: I’m not saying all real estate seminars are bad.  Far from it.  Nor am I suggesting everything that’s “Free” is a scam.  After all, I give tons of free stuff away here…and last time I checked I wasn’t scamming anyone with it.  🙂

But some of these things are just plain baddownright sleazy in fact…and telling the difference honestly can be really hard sometimes for hungry folks new to the REI biz.

Some quick tips to help you discern…

  • Search the interwebs for the seminar instructor and/or company hosting the event beforehand. Now of course you can’t believe everything you see on the net – good or bad – about a company or guru.  You gotta keep in mind that some folks are just hateful and/or chronic grumblers and will concoct complaints about even some of the best out there just because they can.  But it’s a place to start, and if you find more than a couple of red flags out there, then be very cautious.
  • Be wary of “free” seminars. Often they serve as forums to sell you more stuff. Which isn’t necessarily a bad thing, mind you.  Remember, we’re all in the business of selling, and there’s nothing immoral with offering some base level training, then higher levels of training and coaching for some people to elect.  But if they overpromise and under-deliver at the event you attend…then want you to pay even more for the “real secrets” you thought you were promised already…that’s a big warning sign, Kemosabe.
  • If you’re ever invited to go raise your credit card limits – RUN! There’s a big, BIG pitch headed your way and they want you primed and ready to go when the time comes.
  • Always ask other respected investors for their opinion first… before you go and spend a Fajillion Dollars on any “soup to nuts training”.  Just get another respected real estate entrepreneur’s advice – preferably someone with a clear head and a little more experience under his/her belt already.  And don’t look for ways to justify an emotional decision you’ve really already made anyway.
  • ____________________________ (Insert your own tip – in comments below 🙂 )

So how do you feel about all this  Ever been to one of these things?  Ever known (or been) someone sorely duped by them?  Thoughts on the “expose’” video – was it balanced/fair?  Looking forward to hearing what you think…

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Who’s Getting Rich Off Rich Dad?, 5.0 out of 5 based on 2 ratings

About 

JP Moses is a roughly-hewn man-child who first got into REI after reading Rich Dad, Poor Dad back in Y2K and went full time in 2002. He's tinkered in everything from landlording to short sales to rehabs to Realtoring to REOs to notes to owner financing, blah, blah, blah...Till he finally stuck his flag deep into wholesaling and has since flipped somewhere north of a couple hundred deals.

JP's not a “guru” but also doesn't think it's a bad word. Among his core values are authenticity, creativity, big honkin' value, general fun-ness and being unshaven. He's super proud to be chief blogger guy at REItips.com and host of the free REIology podcast. He also thoroughly enjoys sharing his 53 best real estate investing forms with anyone who wants them. You should totally check that out. :-)

  • Mrfixit34116

    We attended the 3 day seminar in Nashville recently. It cost us $200 and was an informative event as far as some little tricks go. For a Company trying to put on a show about being rich they fell short. All we got was free water and soda the whole 3 days. If you are going to try to get someone to spend 10s of thousands of dollars it would seem like they would as least be able to feed you.  It is a well executed sales pitch and a good play on your emotions. They are selling a way of life to the people with hype and exaggerated income claims. There were people that signed up for the advanced training and they
    walked around after that like their shit didn’t stink because they had a
    VIP sticker on their shirt. They will find out how stinky it is when they can’t afford toilet paper cause they were suckered out of their money. SUCKERS

  • Blistar618

    I attended a free Rich Dad real estate seminar about 1 month ago. They really played up the connection to the Rich Dad series of books(which i really like) and so I signed up for the “Rich Dad real estate seminar”. Last weekend I attended the real estate seminar. At first I was enthusiastic and interested in the information I thought I would be privy to. However it did not take long for me to realize that the whole premise of the so called seminar was to upsell us into something else. I have taken enough selling and marketing courses to realize that they were just leading us to the slaughter. They would scratch the surface of some interesting concepts and then get everyone to agree over over that they needed further education. They even went as far as to announce that if there were any naysayers or anyone being negative that they should be reported to one of our trainers so they could be dealt with. The reason for this was not clear at first but then I realized it was because there was so much money at stake for them they did not want anyone to voice an  opinion that may influence or sway others from investing it the course. One of the strategies that they strongly recommended was to call all your credit card companies and ask to increase your credit limits. Not by a little, they wanted us to ask for double what our credit limits were currently. Wait a minute here………..They know that very few people have the $36,000 in cash to invest in their “real estate program”, so what better way to enable the seminar attendees to take the “advanced training” than having enough available credit on their credit cards?????? Hmmmmm it seems to be getting more and more interesting. They continued to pound us with “investing in your education” “you will make it all back on your first deal” “a small price to pay to be a millionaire” etc etc. The trainer even let us know he is contracted by rich dad and is compensated based on how many people sign up? Talk about a conflict of interest. Also after doing some research I discovered that this in not even put on by Rich Dad and Robert  K. He is not even involved in it. It is run by a Russ Whitney company..Anyway I would suggest that anyone thinking of going to one of these seminars to watch the 3 part investigative report on You Tube “Rich Dad Poor Dad’ Robert Kiyosaki Exposed”  

  • Big Dan12

    It doesn’t look like anybody who actually paid 20-30k wrote a response in this section. I’m looking to sign up for one of his classes and would love some feedback from those that actually took the next step. Thanks.

  • taraT

    I can say unequivocally that NONE of the dozens of ‘real estate investor trainings’ work. We’ve blown over $15k over the last 5 years on numerous real estate seminars, DVD courses, mentors, etc. including Trump, Graziosi, Fortune Builders (Than Merrill), etc. We kept trying because we thought we weren’t doing it correctly, or didn’t have the right ‘mentor’, or weren’t using the right techniques. The fact is, it’s very difficult to do RE deals with no money or credit and usually illegal! Check your local real estate laws, but in our state ‘bird dogging’ (paying someone to provide leads) and ‘assignment of contract’ (wholesaling) are practicing real estate without a license and illegal! If you have money to invest then, by all means, learn the ropes. But please don’t spend money on these so-called ‘gurus.’ They make more money selling info than actually doing real estate deals! Attend local REA group meetings, buy a book or two, or even better become a Realtor! Understand that ALL real estate investor ‘trainings’ are frauds!

  • Avie Couterie

    Whitney had the ‘established’ built-in network of Presentor’s & Hotel Sales Personnel contacts. Essentially Kiyosaki did a deal utilizing Whitney existing network in exchange for lending his ‘branded’ namesake to foster continued profitability for Whitney & himself. But as a male commenter pointed out above this was a ‘No Win’ versus a ‘Win-Win’ apparently.

  • Avie Couterie

    Absolutely correct!

  • Avie Couterie

    Glad you met a nice person. Unfortunately, most of the personnel you see at such seminars/workshops or called Presentor’s who do get paid an average salesmans wages with ‘reimbursed’ travel benefits. True, some of them are experienced in doing R.E. investing but most are fledgling ‘rookie’ REI’s.

    Best Bet: Ask what level of R.E. investing they are currently at (Novice, Intermediate or Pro). Then THOROUGHLY [diligently] research EVERY SINGLE STATEMENT they make!

  • Avie Couterie

    HUGE TIP !!! TAKE HEED OF THIS!

    IF….IF…..and only…..IF you go charging/diving in to grab one of their offers at such R.E. Investing seminars/workshops and you ACTUALLY SIGN A CONTRACT and later after some further thought and/or research regret the loss of cash then you still have an ‘EXIT STRATEGY’.

    Most every U.S. State has explicit laws stating that ANY CONSUMER/CUSTOMER HAS THE IMPLICIT RIGHT to
    1.) CHANGE THEIR MIND,
    2.) CANCEL their contract + contractual obligations
    3.) REQUEST & RECEIVE A FULL REFUND of all monies paid

    It absolutely MUST BE DONE WITHIN a specified period [normally 3 Business Days as designated by your state government officials. (State of Illinois last known is not to exceed three (3) business days.) But every state varies!

    So FIRST conduct your ‘DUE DILIGENCE’ on that company 1ST before attending!

    As soon as the contract forms are laid out on the tables at the back of the room: Mosey on over to Check & Verify that there is actually a “Cancellation Policy Statement” either within the wording of the contract or on the backside of the contract.

    If none, then RUN!

    If there is a cancellation policy on back:
    a.) Continue listening, notetaking and decide later.
    b.) Exercise cancellation ON-THE-SPOT if you have already signed a contract and regret or doubt anything.. Of course, you can still retain the free materials.

  • Avie Couterie

    Agree about the selling tactics. You do become quite numb, lol.

  • Avie Couterie

    I would tend to agree to that, “frauds”, lol. What state are you in since you said bird-dogging & wholesaling are illegal. Need to make sure I don’t attempt to do business in that state!

  • Avie Couterie

    YES, the old ‘Increase Your Credit Limit’ tactic. Unbelievably most fall for this because of course they would love to have their limits increased, LOL. Who wouldn’t.

    First heard this tactic back in early 1990’s and knew that it would continue to sway millions as I too have enough marketing/advertising/sales & public relations experience to write numerous books on swindle tactics used in almost every industry literally bringing this country to its knees by spilling the beans.

    But in all honesty…….HOPE, PROMISE, DREAMS and oh yeah, GREED are the propellants that drive citizens to these functions. And the tactics used are only designed to pick [out the ‘Doer’s], tweak [their desires] and capture [them at the peak of their willingness to throw caution to the wind].

  • taraT

    OR. Bird-dogging and wholesaling are practicing real estate without a license. Given that (at least in my state) investigations are complaint driven, so you could likely do a few deals a year without attracted any attention. But the ‘gurus’ should at least check state laws and let their perticipants know.

  • Avie Couterie

    It’s definitely a “Too good to be true”.
    REAL TRUTH is this though:

    A.) With enough financial backing and KNOWLEDGE about:
    – – Real estate facts (demographics/comps/markets);
    – – Construction & dealing with Contractors
    (building & demolition);
    – – and Sales Concepts & Strategies
    (selling the idea of “HOME” inclusive of ‘staging’ a property)

    THEN ANYONE CAN LEARN HOW TO INVEST!

    What all seminar personnel NEVER TELL you is that. Why would they? They want you to believe you cannot learn it or do it without some help. Well, true you will need help but not their kind of help!

    You will need: A support team!
    Financial backers: simply those willing to lend that you can AFFORD to payback IN FULL & ON TIME! And return time & time again for new deals.

    Contractors: Bonded/Licensed, Insured properly, Highly Reputable, Experienced, Communicates Well, Understands & Follows Directives, Effective Crew Mgr., and On-Point Budget Mgmt. (no cost overruns).

    Real Estate Network: Building up Industry Contacts: agents, etc. that can help propel your business goals.

    and foremost…..FAMILY SUPPORT!
    That is indeed crucial! They can either aide or step-aside and not interfere. They do not have to be embroiled in your business matters to be supportive. But they must not take up your time with their responsibilities or repetitive needs.

    Now armed with that you are almost prepared. Next requirement is:

    KNOW & DEVELOP YOUR RESOURCES
    Know How to Research Properties – (Due Diligence) and
    How to Calculate the Numbers!

    1st) Know where to find property info
    (state/city/town/village offices, etc.)
    2nd) Find out all you can on the area (region, local community)
    3rd) Find industry contacts (they’re everywhere, literally)
    4th) Know how to speak ‘Business’ not just “What’s up, Man. I got this deal…”.
    5th) Organize your time, Deploy Your Team, and Focus on your Tasks.

    Once armed with knowledge & support needed then jump in!

    Then occasionally attend one of these seminars only to primarily get revved up again if down in the slumps and not motivated. And hopefully, possibly, learn some tips (if they even have any).

  • Avie Couterie

    BRAVO! That’s called beating them at their own game! Applause!

  • Avie Couterie

    There are none. Majority are in same range. Smaller, lesser known outfits may be out there offering such but there materials are lacking at best most often. Some even copy books authored by others to staple & pass out to attendees. This usually happens at bank branches and community centers. So don’t expect much. If you just need to understand ‘Real Estate’ more strongly suggest reading some educational & industry publications first including browsing some real estate home sales magazines. Then attend some seminars – – BUT DO NOT TAKE YOUR CHECKBOOK OR VISA! Leave it safely at home (LOCKED UP)! Serious! Not joking!
    After you have attended a few and taken EXCELLENT notes. Then sit down and reread, review what you heard. Then attend a 3-day event and be loaded with pertinent questions! If they can’t answer every question then LITERALLY RUN OUT THE HOTEL DOOR! And do not hesitate as your $ will be wasted if you follow through.

  • Avie Couterie

    100% agree with your conclusions, Adil. Seems we’ve both attended the same events. Yes, I too found Trumps to be most ethical utilizing the states 3-Day Right to Cancel Clause on back of every contract. BRAVO, I applaud them. I also obtained a mint of info (+ loads of laughter) from Mr. Gosh, a fantastic presentor! Robert Allens 3-day events employs some ‘Actual R.E.I.’s’ usually which makes them anow informative outfit. All others including Russ Whitney, Dean Graziosa , etc. were a complete total waste of time! Plus they got no money from me! Only Trump got money ($1500) which I promptly refunded within 3-days and retained the ‘free’ materials.

  • Avie Couterie

    EXACTOMUENDO!

  • Avie Couterie

    100% Agree! KUDOS!

  • Avie Couterie

    I second that opinion, Bill!

  • Avie Couterie

    Basically a redundant question at best as simple answer is NO.

  • Avie Couterie

    Don’the believe all you hear, youngin!
    It also allows them to pinpoint which individuals are feet first doers and monetarily capable for up sells over the phone or email.

  • Avie Couterie

    Exactly! Made you want to puke almost!
    His crew was so inept on real estate knowledge that I literally pushed us out the door and left the hotel!

  • Avie Couterie

    Love your cancellation process and vigor in so doing that! BRAVO! Also know that many states have a ‘Right To Cancel’ ruling to cancel any contract. And, oh yeah, hee, hee……love the salesmanship tag at the end! LOL!

  • Avie Couterie

    Indeed.

  • Avie Couterie

    Love your pragmatic approach & viewpoint! Right on-point!