Robert Kiyosaki, renowned author of Rich Dad Poor Dad and self-made multi-millionaire, raised eyebrows when he revealed why he and his wife Kim chose not to have children. For a man focused intensely on amassing assets and generational wealth, this decision may seem counterintuitive. Yet Kiyosaki made this deeply personal choice deliberately, redirecting the time and resources of parenting towards building their fortune and crafting a lasting legacy.
In a video interview with djvlad, Kiyosaki pulls back the curtain on his unconventional path: forgoing a family to construct a foundation aimed at bettering lives long beyond his own. Though the decision stems in part from a tough upbringing, his no-kids policy ultimately reflects strategic priorities to grow assets now and fund big visions for the future. For those focused on strategic wealth building, his choice presents an interesting case study in how the ultra rich plan for multi-generational impact.
Why Forego Kids? A Painful Past and Laser Focus on Assets
Kiyosaki attributes his choice largely to two key factors:
1. His own traumatic childhood – Kiyosaki has often highlighted his tough upbringing, including an absentee father and time in orphanages. He feared perpetuating this painful start for another generation.
2. The all-consuming desire to build wealth – Amassing millions requires immense focus and sacrifice. Raising children would divert too much time and too many resources from the laser targeted goal of asset accumulation.
As Kiyosaki put it, "I chose not to have children…because I would be a lousy dad. I‘m focused on building assets.” At the core, he feared failing as a father while yearning to construct a fortune. With both huge personal goals tugging at his time, Kiyosaki decided conclusively not to divide his focus.
The Monumental Costs of Kids
For context, the average cost to raise a child to age 18 hovers around $233,000 in America, with higher income families exceeding $500,000 per child.
With private schools, tutors, travel sports, cars and college averaging over $200,000 now, one or two kids can slash wealth building capacity dramatically. Each child effectively reduces investable assets by at least mid six figures, handicapping portfolio growth.
Compare that to the results of instead investing $233,000 at a 10% annual return over 18 years: over $1.1 million. The opportunity cost of kids proves staggering, significantly hampering asset accumulation.
For the childless by choice like Kiyosaki, assets trump kids in terms of legacy building. Investing time into growing wealth rather than parenting pays dividends long term. As Gary Vaynerchuk, also without children, puts it: "I can continue to compound money, I can continue to compound assets.”
Planning for Death and Beyond – Funding Big Dreams
While the childless can compound assets exponentially in their lifetime, immense challenges await at death. Estate taxes threaten to deplete half of lifetime wealth built. And who ensures assets amassed continue making an impact?
Kiyosaki‘s solution is a layered long term plan aiming to conquer both challenges. His priorities extend well beyond his lifetime, funding big goals for generations to come.
Dodging Estate Taxes
In the interview Kiyosaki says, “I intend to give all my money away before I die by setting up foundations that will protect my assets from estate taxes.” Constructing foundations to house assets side steps the steep taxes levied at death. Accounts held by charitable foundations pass directly, escaping the debilitating 50% haircut most estates confront.
This structure proves popular among the ultra wealthy seeking to preserve their legacy. Foundations shelter assets for designated causes, acting as a tax exempt vehicle to fund big visions rather than lining government coffers.
In fact, estates over $10 million stand to lose 40-50% to federal and state estate taxes. That equates hundreds of millions vanishing from portfolios painstakingly built over decades. Utilizing foundations as part of estate planning grants more control over your legacy.
There are a range of foundation structures to accommodate wealth preservation based on goals:
Private Family Foundations: Ideal for high net worth families seeking to centralize charity and pass values. Family members direct grants towards chosen causes.
Donor-Advised Funds: Simplest option where you donate assets and then recommend grants from the sponsoring nonprofit. Takes minutes to set up.
Charitable Trusts: Utilizes trusts to pay out income to designated charities over time. Can last multiple generations.
Each option offers unique benefits, but the overarching aim remains shielding your estate from taxes to enrich causes close to your heart.
Enriching Lives Long Term Through the Rich Dad Foundation
For Kiyosaki and Kim, their vast wealth will ultimately fund the Rich Dad Foundation. This non-profit provides financial education to underserved communities, helping individuals build assets and achieve financial independence.
The foundation sits at the very heart of their life‘s work. Its mission of empowering people to control their financial futures reflects the core principles within Rich Dad Poor Dad. By housing assets in the Foundation accounts, the Kiyosakis ensure their wealth enriches financially illiterate populations long after they pass.
As Kiyosaki states, after Kim goes, "the Rich Dad Company gives the money to the Rich Dad Foundation and the mission continues in perpetuity." This illustrates a chief benefit of strategic estate planning using foundations: wealth earmarked for causes close to your values outlives you, funding big dreams for generations.
In fact, Kiyosaki projects gifting upwards of $100 million to the Foundation in coming years to expand reach globally. The funds will enrich financial education programs bringing his patented money principles to wider audiences worldwide.
Billionaire Philanthropists Without Kids – Values Living On
The Kiyosakis join a growing list of billionaires without heirs relying on foundations to carry on their life‘s work:
Bill Gates – The Microsoft founder and onetime world‘s richest man opted not to split his fortune among potential heirs. Instead the Bill and Melinda Gates Foundation stands poised to receive their $100+ billion estate to continue health and anti-poverty efforts.
Sara Blakely – The Spanx founder and billionaire signed the Giving Pledge to donate at least half her estate to charity and empower women globally. Her foundation work stands as her lasting legacy.
James Dyson – The vacuum mogul Dyson requests his $23 billion fortune fund engineering education after passing. His assets will enrich scientific innovation for generations, not line family pockets short term.
MacKenzie Scott – After her high profile divorce, the author and philanthropist committed to giving away her $35+ billion Amazon windfall to worthy causes through a donor-advised fund.
Though without children, each individual‘s values, beliefs and life passions will live on through their foundations. Harnessing estates in this strategic manner leads to generational impact on chosen causes.
Key Takeaways – Prioritizing Assets Over All Else
- For Kiyosaki, amassing assets eclipses other life priorities like raising children
- Foundations help consolidate wealth outside estate tax scope to fund big visions beyond one‘s lifetime
- Alternatively, the childless can compound wealth exponentially to later enrich causes
- $233,000+ saved per kid can compound into over $1M more for investments in 18 years
Robert Kiyosaki’s choice stems from past pain and future ambition. While forgoing children proves controversial, none can argue the intense asset focus hasn’t paid dividends. At 75 years old, his multi-million dollar fortune now positions the Rich Dad Foundation to empower financial education perpetually.
This demonstrates strategic estate planning at its finest – assets built expressly to fund values based causes long after you’re gone. For those sharing Kiyosaki’s wealth building mindset, it highlights the power of purposeful planning. If you keep your focus on assets alone, foundations prove the vehicles to drive impact well into the future.