" What Is the Price of Becoming Rich? 211 The Definition of Rich Forbes magazine defines rich as $1 million in income and $10 million in net worth. Rich dad had a tougher definition: a consistent $1 million in passive income, which is income that comes in regardless of if you work or not, and $5,000,000 in assets, not net worth. Net worth can be an elusive and much- manipulated figure. He also felt that if you could not maintain a 20% return from capital invested, you were not really an in- vestor. The price to reach rich dad's goal, starting from nothing, is actually measured in rich dad's three E's: education, experi- ence, and excessive cash. When I returned from Vietnam in 1973,1 had very little of all three. I had to make a choice: Was I willing to invest my time to attain all three of the Es? Rich dad did, his son Mike did, and many of my friends are still investing their time to gain the three Es. That is why they got richer and richer. It Starts with a Plan To be a rich investor, you must have a plan, be focused, and play to win. An average investor does not have a plan, in- vests in hot tips, and chases the hot investment products of the day, flitting from technology stocks to commodities to real estate to starting his or her own business. It's OK to invest on a hot tip now and then, but please do not delude yourself that one hot tip will make you rich forever. In addition to the three Es, rich dad had a list of what he called the five Ds that were required to become very rich, es- pecially when you start with nothing. They are: 1. Dream 4. Data 2. Dedication 5. Dollars 3. Drive In February of the year 2000,1 was working with a group of very bright graduate students at Thunderbird University, The American School of International Management. During the three hour session I asked one of the young students, "What is your investment plan?" Without hesitation he replied, "When I graduate I will find a job that pays me at least $150,000 a year and begin putting aside at least $20,000 a year to buy investments." I thanked him for his willingness to share his plan with me. Then I said, "Do you remember me discussing my rich dad's 90/10 principle of money?" "Yes," said the young man with a smile, knowing that I was about to challenge the way he was thinking. He was enrolled in the entrepreneurship program of this very prestigious school where I was a guest instructor. By now, he knew my style of teaching was not to give students answers. My style was to challenge core beliefs and a"sk students to evaluate old thought patterns. "What does the 90/10 principle of money have to do with my investment plan?" he asked cautiously. "Everything," I replied. "Do you think your plan of finding a job and investing at least $20,000 a year will put you in the The 90/10 Riddle 215 category of the 10% of investors that make 90% of the money?" "I don't know," he replied. "I never really thought about my plan with that benchmark in mind.