How to Build Wealth: Financial Rules Everyone Should Know

The wealthy don’t just make more money—they play by a whole different set of rules. And honestly, once you get the hang of them, financial worries start to fade away.

Robert Kiyosaki, best known for his “Rich Dad Poor Dad” books, breaks it down to five key principles that set the rich apart. We’re going to go through them, one by one, so you can start using them in your own life and build real wealth.

Stick around to the end—there’s one habit that every self-made millionaire swears by.

So, Kiyosaki says financial intelligence rests on five pillars. Grow each one, and you put yourself on the fast track to wealth.

Pillar One: Expand How You Make Money

The first step is all about learning to make more money. Yeah, it sounds obvious. Most of us go to work and expect a paycheck. But that’s not really the point.

Kiyosaki believes you shouldn’t just work for money—you should work to learn how to earn even more.

Take his first job. He picked a position with a low salary just to learn sales. That sales experience was way more valuable than a higher paycheck, because it eventually let him start his own company.

Books and seminars are fine, but nothing beats real, hands-on experience. So when you pick a job, go for the one that teaches you the most—even if it doesn’t pay the most.

He also talks a lot about embracing challenges. Every time you solve a new problem, your financial intelligence grows.

You fix one issue? Move on to the next. It’s all about building experience that pays off later.

And don’t just focus on your own money issues. Try helping others solve their financial problems—give advice, analyze their situation, whatever you can.

It’s one of Kiyosaki’s top secrets for increasing your own income. Think about it: the more valuable problems you solve for others, the more valuable you become.

Pillar Two: Protect Your Money

The next step: keep what you earn.

According to Kiyosaki, the world is crawling with people and institutions ready to take your money—banks, brokers, “financial advisors” with outdated advice.

He’s pretty blunt: don’t hand out your trust easily. Most people just want to profit off your mistakes.

So, protect your money.

Get advice only from the best lawyers, accountants, and tax pros you can find—people who know what they’re doing.

And most importantly, learn how to manage your finances yourself. Take it slow if you need to, but the goal is to get smart enough that nobody can pull a fast one on you.

Pillar Three: Master Money Management

It’s one thing to make and protect your money—but you also need to manage it well.

Think: budget surplus.

Simply put, you want your income to be way bigger than your expenses.

The truth is, if your spending is out of control, there’s no way to get ahead.

Kiyosaki says the trick is to pay yourself first and prioritize accumulating assets—stuff that puts money in your pocket, not just stuff that sits and gathers dust.

So, save and invest first. That can mean buying stocks, real estate, taking a course, or even donating to charity if that’s important to you.

But don’t kill all your enjoyment for the sake of money.

Keep a baseline quality of life. If you cut everything fun, your motivation dries up.

There’s a balance—enough to keep your spirits up, but not so much that you dig yourself a hole.

Track Where Your Money Goes

Kiyosaki also recommends writing down your expenses.

When you see where your money goes, you can predict where you’ll end up.

People investing in assets get richer; people blowing money on consumer junk stay broke. Track your spending, notice the patterns, and tweak things as you go.

Make Your Assets Pay for Your Liabilities

He’s got one more rule: make your assets pay for your liabilities.

Before you buy that new car or gadget, find a way to get something else—maybe a rental property or investment—that brings in enough money to cover it.

That way, you’re not just consuming, you’re building.

And if your finances get tight?

Kiyosaki suggests spending more money on assets, not less.

Businesses cut marketing budgets when they should spend more to boost sales. People do the same—when you’re struggling, invest in things that will eventually pay you back.

That’s how you develop real financial smarts.

Pillar Four: Learn to Invest

Making money isn’t enough.

You have to make your money work for you. That means investing.

Kiyosaki is a huge fan of real estate—you get passive income through rent, and the property often rises in value.

Beyond that, securities like stocks can grow your wealth, and business investments—starting your own company or investing in someone else’s—can be even more powerful.

But don’t jump in blind.

Keep learning. The more you know about how investing works, the better your decisions—and your results.

Pillar Five: Master Information

We live in the information age.

There’s more data out there now than ever, but that doesn’t always mean we’re smarter for it.

Kiyosaki says smart money comes from sifting through all that noise, keeping what’s true and helpful, and tossing the rest.

Here’s how he does it:

Whenever you get info, ask yourself—is this relevant?

Is it from a trustworthy source?

Can I verify it?

Is it an opinion or a fact?

The better you get at separating useful info from junk, the better your financial moves.

If you make decisions based only on opinions—even from so-called “experts”—you’re taking big risks.

Focus on hard evidence and watch for trends and cycles. That’s how you anticipate what happens next instead of just reacting.

Financial Goals to Hit in Your 20s

Let’s talk about the big money moves to hit in your 20s if you want to set yourself up for a strong financial future.

I got the idea for this after chatting with my friend Kayla, who’s 25 and wanted to know if she was missing anything important on her road to financial freedom.

I’m 34 now, and I learned a ton about money—especially budgeting and investing—during my own 20s. I even worked as a financial advisor at Merrill Lynch when I was 25, and that experience honestly gave me a huge head start.

The thing is, the way school is set up, none of this stuff really gets taught, does it?

So, think of this as a no-nonsense guide for all the financial basics you need to crush your 20s.

If you know someone who could use this, pass it along. Maybe it’ll be the kind of thing you want to look back on later, too.

Hit that like button, and let’s jump in.

We’re starting from the top: the money milestones you want to hit, in the order that makes the most sense for most people.

First up: debt.

Milestone One: Pay Off Debt or Avoid Student Loans

Odds are, if you went to college, you left with some loans (the average is about $39,000 in the US), or maybe a bit of credit card debt too.

Your first big money goal in your 20s? Make a game plan to pay that off.

Federal student loan rates usually land between 4-6%, and I guarantee you’ll have friends telling you, “Why pay that off? Just invest and you’ll make 8%.”

Yeah, maybe, but don’t forget you can just as easily lose money in the market—there are no guarantees.

When you pay down those loans, that’s a guaranteed return, and it takes a huge weight off your shoulders.

When you’re not stuck paying someone back every month, you can actually take more risks—trying a start-up or a new business.

Debt keeps you tied down, sometimes forcing you into jobs you don’t love just to service the payments.

And if you haven’t started college yet?

Really think about whether a four-year school is worth the debt.

You can do two years at a community college, then transfer, and your diploma will look the same in the end.

Nobody cares where you started.

Milestone Two: Get a Job—Any Job—to Earn and Learn

Next up: get a job and start earning.

In your 20s, you want to try as many jobs as possible, not only to make money but to figure out what you actually enjoy.

By the end of your 20s, it’s great if you’ve found a field you love, because earning potential usually goes up the longer you’re in the same industry.

Think about it: you want the plumber with 30 years of experience, not the one who started yesterday.

Even if you don’t find “the one” right away, just working and having that experience will show you how hard it can actually be to make money.

Back when I started, hitting $100,000 a year sounded so easy—until I realized how long and hard you have to work to get there.

That lesson is priceless.

Milestone Three: The Trifecta of Financial Wisdom

Once you’re working, you reach what I call the trifecta of financial wisdom in your 20s.

These three go together:

1. Learn to delay gratification.
2. Avoid credit card debt.
3. Start building good credit.

You’ll probably get your first credit card in your 20s.

They’re not evil, but you have to use them right—pay them off in full every month.

Credit card interest is sky-high, often around 18%.

Fall behind and it’ll torpedo your finances.

But if you handle your credit card correctly, your credit score goes up, which unlocks cheaper loans for cars, homes, and helps with renting.

A high credit score doesn’t sound sexy, but it actually saves you tens of thousands over your lifetime.

Missing a payment?

Don’t do it—just set up autopay and forget about it.

Why Delayed Gratification Matters

And on delayed gratification: if you can hold back on big purchases and save now, your wealth will grow faster.

I know it’s tempting to blow money on things like brand-name slides or the latest tech, but skipping some of those impulse buys now lets your future self afford way bigger things.

Here’s a quick example.

Person A saves $500 a month in their 20s, person B saves $750.

By 30, that’s $60,000 vs $90,000.

Fast forward to age 65 after investing, A ends up with about $887,000, while B retires with $1.33 million—just because B was a bit more disciplined in their 20s.

So, next time you’re about to splurge, just remember—future you will thank you.

Milestone Four: Set a Real Savings Goal

Pick something worth saving for: a house, wedding, vacation, or your own business.

Having a goal gives your savings a purpose and makes budgeting way easier.

A big lesson for your 20s is: don’t spend every dollar you make.

Living below your means means you can stash money away for big dreams later.

I personally kept my living costs steady for years, even as my income grew.

The result?

Now I have options—buying a home, investing in property, or dropping cash on a big purchase without stress.

It’s all because I kept my lifestyle in check instead of chasing short-term happiness with more stuff.

Milestone Five: Build a Budget With the 50/30/20 Rule

So, how much should you save?

Try the 50/30/20 rule.

It’s simple:

• 50% of your income goes to needs, like rent and bills.
• 30% goes to wants.
• 20% goes to savings.

If you’re making $5,000 a month, that’s:

• $2,500 for needs
• $1,500 for wants
• $1,000 for savings

To start, spend an hour or two going through your bank and credit card statements.

Sort everything into needs vs. wants.

This gives you a clear starting point to build your first real budget.

Milestone Six: Start Investing

Once you have your debt under control, a budget you can stick to, and at least a small emergency fund, it’s time to invest for your future.

In the US, you’ve got two main options: Roth IRA and 401(k).

Roth IRA

A Roth IRA lets your investments grow tax-free, and you don’t pay taxes when you take the money out at retirement.

That’s huge.

You can contribute up to $6,000 a year if you’re under 50, and you need what’s called “earned income” to do it.

Opening one is easy—a brokerage like Fidelity or Vanguard can help you get set up, and you just transfer money from your bank.

401(k)

A 401(k) is through your employer and lets you put in a lot more, up to $20,500 (as of 2022).

With a traditional 401(k), you don’t pay taxes on your contributions now; you pay them in retirement, hopefully when you’re in a lower tax bracket.

If your company matches contributions, always take advantage.

That’s literally free money.

You can have both accounts at the same time, by the way.

Milestone Seven: Invest in Index Funds

Last up: where do you actually put your investing money?

For almost everyone, index funds or ETFs are the way to go.

These are big baskets of stocks—if you buy a fund that tracks the S&P 500, for example, you’re instantly invested in a slice of all 500 companies in the index.

Index funds have averaged about 8% a year over the long haul.

They automatically give you diversification, and the fees are super low.

Personally, I stick to VOO (Vanguard’s S&P 500 ETF), but there are plenty out there—just look for one that covers tons of companies if your favorite isn’t available.

And don’t freak out when the market drops.

The biggest up days usually come right after the biggest declines, and nobody can predict the right time to jump in or out.

Just stay invested for the long term, and you’ll be way ahead by retirement.

Becoming Financially Holistic

Kiyosaki’s final message is simple: don’t pick and choose between these pillars.

Develop all five together.

That’s how you solve the “how to get rich” puzzle.

And, one more thing—you need courage.

It takes guts to try new things, to act boldly, to learn from mistakes, and keep pushing yourself.

Don’t worry about what other people think.

Don’t be afraid to ask for advice or feedback.

Just keep your eyes on the goal: financial freedom.

Make money management your thing.

Be curious about it—interested, even passionate.

Set a clear goal for what you want to earn each month.

Try out Kiyosaki’s approach and see where it gets you in six months.

The Complete Wealth-Building Checklist

If you want to turn everything above into a simple checklist, start here:

1. Increase Your Earning Power

Build valuable skills, gain experience, and learn how to solve problems that people are willing to pay for.

2. Protect Your Income and Assets

Understand your finances and carefully evaluate the professionals and advice you rely on.

3. Control Your Spending

Track your expenses and make sure your lifestyle doesn’t grow faster than your income.

4. Pay Down Expensive Debt

Create a plan for student loans, credit cards, and other debts that can hold back your financial progress.

5. Build Good Credit

Use credit responsibly, pay bills on time, and avoid carrying expensive credit-card balances.

6. Create Specific Savings Goals

Give your savings a purpose, whether that means an emergency fund, home, business, education, or another major goal.

7. Build a Budget

Start with a framework such as the 50/30/20 approach and adjust it to your actual circumstances.

8. Start Investing

Once your financial foundation is in place, begin investing for long-term goals.

9. Learn About Diversified Investments

Understand index funds, ETFs, stocks, real estate, and other investment options before putting your money to work.

10. Keep Learning

Financial intelligence grows when you continually improve your understanding of money, markets, taxes, and investing.

11. Think Long Term

Avoid making major financial decisions based entirely on short-term market movements or trends.

12. Keep Your Lifestyle Under Control

As your income increases, resist the temptation to immediately increase your spending.

Frequently Asked Questions

What are the five pillars of financial intelligence?

The five pillars discussed in the article are expanding how you make money, protecting your money, mastering money management, learning to invest, and mastering information.

What should I focus on financially in my 20s?

The article recommends focusing on debt, earning and learning through work, avoiding unnecessary credit-card debt, building credit, setting savings goals, budgeting, starting to invest, and learning about diversified investments.

Should I pay off debt before investing?

The supplied material emphasizes getting debt under control before moving heavily into investing. The right balance depends on the type and cost of debt, available emergency savings, and individual circumstances.

What is the 50/30/20 budgeting rule?

The 50/30/20 framework divides income into approximately 50% for needs, 30% for wants, and 20% for savings. It can be adjusted depending on your income, expenses, debt, and financial goals.

What is delayed gratification?

Delayed gratification means choosing to postpone some purchases or rewards today so you can work toward larger financial goals in the future.

Why is building credit important?

Good credit can help people qualify for loans and other financial products at more favorable terms. The article emphasizes paying credit-card balances responsibly and avoiding missed payments.

What is an index fund?

An index fund is an investment fund designed to track a particular market index. For example, a fund tracking the S&P 500 provides exposure to companies represented in that index.

Is investing in your 20s important?

Starting earlier can give investments more time to potentially grow and compound. However, investments involve risk, and past performance does not guarantee future returns.

What is financial intelligence?

Financial intelligence refers to understanding how money is earned, protected, managed, invested, and evaluated. In the framework discussed here, it involves developing skills across all five areas rather than focusing on income alone.

Final Thoughts

Building wealth isn’t about finding one secret investment or making one huge financial move.

It’s about developing better habits over time.

Increase your ability to earn. Protect what you make. Control your spending. Pay attention to debt. Build savings. Learn how investing works. Keep improving your financial knowledge.

If you’re in your 20s, you have something incredibly valuable on your side: time.

You don’t need to have everything figured out today.

Start with the basics, make steady progress, and avoid letting short-term spending decisions derail long-term goals.

And if you’re already past your 20s, the same principles still apply. It’s never too late to take a closer look at your income, expenses, savings, investments, and financial goals.

Kiyosaki’s broader message is to develop financial intelligence across multiple areas rather than relying on a single strategy.

Make money management your thing.

Be curious about it. Learn from your mistakes. Question the information you receive. Set specific goals and keep working toward them.

Your journey to financial freedom doesn’t happen overnight.

It starts with the next smart financial decision you make.