Robert Kiyosaki, author of "Rich Dad Poor Dad," has revealed that he is 10 billion rupees in debt. Let's find out how such a savvy and well-versed money-manager ended up with so much debt.

Robert Kiyosaki debt: Is it true that Robert Kiyosaki is in debt?

Robert Kiyosaki, who became famous worldwide with his book Rich Dad Poor Dad, is currently in the news for his debt. Kiyosaki himself has revealed that he owes approximately $1.2 billion, or over ₹10,000 crore. While this amount of debt may surprise you, the story isn't so simple.

In fact, the ₹10,000 crore debt is not Robert Kiyosaki's personal liability. A significant portion of this debt stems from his real estate investments, which involve other partners.

How much debt has Kiyosaki disclosed?
79-year-old Robert Kiyosaki has long claimed that he uses debt to build wealth. Recently, on the "Get Rich Education" podcast, he once again stated that he is approximately $1.2 billion in debt.

Kiyosaki believes that not all debt is bad. According to him, if the borrowed money is invested in purchasing an asset that generates income, it can be considered debt used for investment.

Does Kiyosaki have to repay the $1.2 billion himself?
Interestingly, Robert Kiyosaki doesn't have to repay this debt himself. $1.2 billion doesn't mean Robert Kiyosaki borrowed this much from his own pocket. His former wife and business partner, Kim Kiyosaki, explained that this refers to real estate investments they made together. According to media reports, this portfolio includes approximately 1,500 apartment units. This represents a direct investment of $1.2 billion.

How do you make money with loans?
Kiyosaki advocates investing in assets that generate consistent income. Imagine an investor takes a loan from a bank to purchase a rental property. If the rent and appreciation in the property's value provide a return that exceeds the cost of the loan, then the loan is profitable for the investor.

Kiyosaki refers to this type of debt as good debt. Whereas, buying expensive items with credit cards or taking on debt that doesn't generate any income falls into the category of bad debt.

What's Kiyosaki's debt formula?
Kiyosaki says that instead of selling appreciating assets, he can raise money by borrowing against them. This way, he avoids having to sell his assets and instead invests the money in other assets.

However, this method is not risk-free. If property values ​​fall, rental income decreases, or the interest burden increases, it may become difficult to repay the loan.