" Rich dad often ended his lessons on investing with this statement: "Investing is such a confusing subject for most people because what most people call investing is not really investing." . In the next chapter, rich dad guides me into reducing the confusion and into what investing really is. Mental Attittude Quiz Investing is a vast subject with many different people hav- ing as many different opinions: 1. Do you realize that investing means different things to different people? Yes_ No_ 2. Do you realize that no one person can know all there is to know about the subject of investing? Yes No Why Investing Is Confusing 63 3. Do you realize that one person may say an invest- ment is good and another person may say the same investment is bad, and realize both could have valid points? Yes_ No_ 4. Are you willing to keep an open mind to the subject of investing and listen to different points of view on the subject? Yes_ No_ 5. Are you now aware that focusing on specific products and procedures may not necessarily be investing? Yes_ No_ 6. Do you realize that an investment product that is good for one person may not be good for you? Yes No Chapter 6 Investor Lesson #4: Investing Is a Plan, Not a Product or Procedure I am often asked questions like, "I have $10,000 to invest. What do you recommend I invest in?" And my standard reply is, "Do you have a plan?" A few months ago, I was on a radio station in San Fran- cisco. The program was on investing andjatas4T0sT5n)yvery popular locajtecicBroker. A call came in from a listener want- ing some investment advice. "I am 42 years old, I have a good job, but I have no money. My mother has a house with a lot of equity in it. Her home is worth about $800,000 and she owes only $100,000 on it. She said she would let me borrow some of the equity out so I could begin investing. What do you think I should invest in? Should it be stocks or real estate?" Again my reply was, "Do you have a plan?" "I don't need a plan," was the reply. "I just want you to tell me what to invest in. I want to know if you think the real es- tate market is better or the stock market." Investing Is a Pun, Not a Product or Procedure 65 "I know that is what you want to know... but do you have a plan?" I again asked as politely as possible. "I told you I don't need a plan," said the caller. "I told you my mother will give me the money. So I have money. That's why I don't need a plan. I'm ready to invest. I just want to know which market you think is better, the stock market or the real estate market. I also want to know how much of my mom's money I should spend on my own home. Prices are going up so fast here in the Bay Area that I don't want to wait any longer." Deciding to take another tack, I asked, "If you're 42 years old and have a good job, why is it that you have no money? And if you lose your mother's equity money from her home, can she continue to afford the home with the added debt? And if you lose your job or the market crashes, can you continue to afford a new house if you can't sell it for what you paid for it?" To an estimated 400,000 listeners came his answer.