Tax-Free Wealth

CHAPTER 24: KEY POINTS

1. Tax savings are exciting, but the most exciting part of tax savings is using that money to increase your wealth.
2. The three foundations of wealth building are compound interest, leverage, and velocity.
3. Compound interest by itself is a very slow way to build wealth, but combined with leverage and velocity, it’s a powerful wealth-building tool.
4. The only way to actually save money in taxes is to first start implementing the strategies found in this book. Find a great tax advisor and get started today!

Use my simple formula to create massive passive income. Start with earned income, invest in growth assets, create a huge amount of capital from your growth assets, and then invest in assets that generate passive income. With a substantial amount of capital, even investments with modest returns result in massive passive income.

s all about momentum. The more you leverage and the faster you reemploy your money, the faster you will build your wealth. Just remember the lessons at the speedway:
• Start by getting a proper education from experts who know what they’re doing.
• Then take some practice runs with the experts. When you do start investing or building your business on your own, start slowly and get used to the feel of the track (the investing or the business).
• After a few turns around the track, you can pick up speed and move faster and faster until, before you know it, you’ll be moving at a very fast speed and won’t even have to slow down for the curves in the road.

key to financial
velocity is to keep your
money moving.

Debt is Dangerous for the Uneducated

1. Debt is leverage and can speed up your downfall just as fast as it can speed up your wealth.
2. Before using debt to build wealth, get educated. One of the best ways is by playing Rich Dad’s CASHFLOW 101 game and taking Rich Dad Education classes.

to produce massive amounts of wealth:
1. Compound Interest
2. Leverage
3. Velocity

CHAPTER 23: KEY POINTS

1. The tax law is intentionally vague and allows for great flexibility—if you know what it says and how to bend it.
2. One of the most important things you’ll ever do to protect your wealth is find not just a good but a great tax advisor and preparer.
3. The best tax advisors have a vast understanding of the tax law, can think nonlinearly, and are passionately concerned about your needs.
4. Never use a tax preparer that isn’t also your tax advisor. You may otherwise get great advice that is never used and lose out on great tax savings.

Advisor

1. Must be accurate
2. Prepares your tax returns as well as advises you on your tax strategy
3. Reduces your taxes as he or she prepares your return
4. Reduces your chances of being audited

Characteristics of a Good Tax Advisor

1. Fully educated about the tax law
2. Passionate about reducing your taxes
3. Embraces the law as an opportunity
4. Focuses on permanent tax savings
5. Uses creativity in applying the law in your favor
6. Considers the entire law when reducing taxes, not just a single rule of law
7. Cares more about you than himself or herself
8. Asks you questions about your specific situation
9. Willing to teach you the tax rules

the right Tax Advisor. This doesn’t just require knowing the right questions to ask a potential tax advisor. It means knowing what questions your tax advisor should be asking you.
Also, remember that only you can reduce your taxes. You have to learn enough about how the tax law applies to you so that you can use it to your benefit every minute of every day. Be sure to find a tax advisor who is willing and able to teach you the rules you need to know in order to reduce your taxes.
Many advisors don’t actually want you to know the