We in the United States had the same tax rules until 1986. When I speak in Australia about investing, I often hear howls of protest about my warnings that the government could change the laws just as they did in the United States. I hear things such as "The government won't change the rules," and I just shake my head. They just don't realize how painful the law change was to millions of investors in the United States. Several of my friends had to declare bankruptcy and lost everything they had worked years or decades to acquire. The point I make is: Why subject yourself to the risk? Why not find a property that makes money? Any person can find a property or investment that loses money. You don't have to look too far to find an investment that loses money. You don't have to be smart or financially literate to find an investment that loses money. The problem I have and rich dad had with the idea that losing money was a good idea because of the tax breaks was that such ideas often caused people to be sloppy. I often hear people saying even here in America, "It's OK that I am losing money. The government gives me a tax break for losing money." That means for every dollar you lose, the gov- ernment gives you back approximately 30 cents (depending 176 Rich Dad's Guide to Investing on your tax bracket). To me, there is something missing in that logic. Why not invest so you can have it all, which is secu- rity, income, appreciation, and tax breaks? The idea behind investing is to make money, not to lose money. You can still gain many tax breaks and make money if you are a sophisticated investor. A friend of mine, Michael Tellarico, a real estate broker in Sydney, Australia, says, "People come into this real estate office every day and say, 'My accountant told me to come in here and look for property that I can negatively gear'" In other words, my accountant told me to buy a property to lose money on. Michael then says, "You don't need my help to find a property that loses money. There are thousands of them all around you. What I can help you find is a property that will make you money and you will still get your tax breaks." The reply often is, "No. No. I want to find a property to lose money on." The same thing was going on in America just before 1986. There are several important lessons from this example: 1. The idea that losing money is OK because of tax breaks often causes people to become sloppy in choosing investments. 2. These people do not look as hard for real investments. They do not look at the financials as closely when an- alyzing an investment. 3. Losing money destabilizes your financial position. In other words, there is enough risk involved with invest- ing as it is. Why make it any more risky? Take the extra time and look for solid investments. You can find them if you can read the numbers. 4. The government does change the rules. Financial Literacy Made Simple 177 5.