Dave Ramsey vs Robert Kiyosaki (Ramsey Wins)

So you’ve heard of Dave Ramsey and Robert Kiyosaki, huh?  Well, me too.  They’re both millionaires, right?  Sure, but the methods they teach are not even close to being the same.

In this article, I give a brief rundown on each of their methods and tell you which one wins and why.  Let’s take a look.

Dave Ramsey

According to Dave Ramsey’s website, he became a millionaire at the age of 26 in real estate.  Ramsey had about 4 million dollars in real estate, but 3 million of it was debt.  He was a millionaire.

A lot of the loans were short-term because he was flipping houses. But when the banks “called the notes,” he didn’t have the money to pay them. He fought it for about 2.5 years but ended up losing it all in bankruptcy.

Once he hit rock bottom, he went on a quest to find out how money really works, while working in real estate to make ends meet.

He began to interview older rich people on how they built wealth.  He read all kinds of books, studying everything he could. Ultimately, what he discovered was debt is not the answer to building wealth.

He started his own company in 1992 counseling folks on what he had learned, wrote a book called FinancialPeace that he sold out of his car, and started a local radio call-in show, later called The Dave Ramsey Show.

For 25 plus years, Ramsey has been counseling folks on how to build wealth.  It has been quite a success for him, and it has made him a millionaire for the second time in his life.

The advice Ramsey gives is basically to avoid debt like the plague.  After all, debt is what caused him to lose it all to begin with. His philosophy for building wealth is consistent with that message.

Ramsey’s methods

Dave teaches people not to borrow money. I have listened to him for years, and his advice is consistent with that message.

Dave teaches what’s called the 7 Baby Steps. Here they are:

  1. Save $1000
  2. Payoff all debt except the house
  3. Save 3-6 months of expenses
  4. Invest 15% of income towards retirement
  5. Save for college
  6. Pay the house off early
  7. Save and give the rest away

You can find detailed information on each of these on his website, but that’s pretty much the just of it.

Related: Dave Ramsey’s Baby Steps – Why They Work

Now, that’s the order. Never will he tell you to save for college before saving for retirement; never will he tell you to pay the house off before saving for retirement; and never, ever will he tell you to borrow money outside of a modest mortgage. It’s consistently taught that way, and he doesn’t deviate from it.

The people who call in on his radio show are the typical 9-5 type employees.  This is also about 99% of working people in America.  These are people who make anywhere from $25k a year to people who make hundreds of thousands of dollars a year (and everyone in between).

This isn’t a “get rich quick” kind of plan. This is for the average employee who works for a living, probably has some debt, and probably has some bad spending habits.  This is for people who can become wealthy over the long run. In other words, it’s a marathon; not a sprint.  But make no mistake about it, it is a proven plan, and it will work if you actually apply the principles.

Robert Kiyosaki

First of all, it’s difficult to find any real information about Kiyosaki’s background. Most of what I know (if true) comes from information that he’s written in one of his books.

Now, I haven’t read RichDadPoorDad, but I heard it was pretty good. Even Ramsey had something positive to say about it. Here’s a tweet from Ramsey a few years back:

dave ramsey tweet about robert kiyosaki

I find it kind of strange that they are friends, but let’s put that aside for now.  However, if the book comes highly recommended by Dave, it’s worth consideration (I’m sure I will read it eventually).

The book I have read of his is called TheBusinessOfThe21stCentury, and that is where I’ll share some of the information I do know.

According to his book, Robert Kiyosaki became a millionaire very early on.  Shortly thereafter, he also went bankrupt and lost everything.

During that time, Kiyosaki refused to work because he didn’t want to work for anybody (he has always had the entrepreneurial mind-set that his “rich dad” taught him), leaving him and his wife living in their car.

They wanted to be entrepreneurs “so bad” that they were willing to sacrifice everything to make that happen; they would continue living in their car while trying to grow “their business.”

While living in his car, Kiyosaki was able to publish his own book, and he began selling it out of his car.  Not too long after that, Kiyosaki was a millionaire again.

Not completely sure how Kiyosaki made his millions, but I do know that selling books has been a large part of it.  RichDadPoorDad has been a huge success, and TheBusinessOfThe21stCentury has as well. After all, both of these books have been promoted by people in “network marketing” (or multi-level marking), but I’ll get to that in a bit.

In fact, that is how I ended up reading the book in the first place: It was loaned to me by an acquaintance involved in “network marketing.”  This was also my first time hearing of Kiyosaki.

One last thing about the book

While reading the book, there were a few things that stood out to me as contradictory.

In the first part of the book, Kiyosaki talks about why it’s necessary to have your own business in order to be wealthy; he talked about how he lost it all and got it back again by being an entrepreneur and never an employee; he stressed that the way to do this in the 21st century was via “network marketing.”

And this is where it got weird . . .

Kiyosaki readily admits that he hasn’t had success with network marketing; yet he writes a book promoting it.

He readily admits that he’s not an expert on it, either, so he introduces his co-author, John Fleming, to help us understand what it is.

Kiyosaki even admits that he heard about it in the past, but didn’t want anything to do with it saying, “It sounds interesting, but it’s not for me.”

At that point, Kiyosaki lost all credibility with me; he struck me as a fraud.

Nevertheless, I finished the book (as open-minded as I could), so I will share with you his basic philosophy (even though it’s pretty vague).

Kiyosaki’s methods

Setting aside the fact that he has zero experience, expertise, or success with network marking and wrote a book promoting it, here is the skinny on what he teaches in that book:

Entrepreneurial mind-set

Kiyosaki says, “You have to stop thinking like an employee, you have to start thinking like an entrepreneur or investor. You have to do what they do.”

Start a business

Kiyosaki says that in order to be wealthy, “You have to have a business.”  You are an entrepreneur and your business needs to be an asset that makes you money.  You are no longer an employee.  You don’t work for money; the asset that you build makes money for you. As this happens, you reach a point where you no longer have to work. That is real financial independence.

Use debt for investments

Kiyosaki says that, “You should use other people’s money for investments.”  He recommends investments that are assets and not liabilities (he considers owning a home as a liability).  He only invests his money in things that are assets, things that continue to make him money.

He says, “If you invest in real estate, you should use other people’s money to do it.”

In the book he talks about mutual funds being a bad investment because you can’t use other people’s money for it. He says, “Try to get a 30 year loan on a mutual fund and see what happens. But you can do it all day long on a mortgage, and I’ll take it.”

Kiyosaki has no problem using debt when it comes to investments, especially if it’s in real estate.

Reinvest in your business and assets

Kiyosaki says that, “Once you start a business and build assets, reinvest in those assets, and they will continue to grow and make you money.”


Even though Ramsey and Kiyosaki have some major differences, they actually have quite a bit in common:

  • Both are entrepreneurs
  • Both have built successful businesses
  • Both are millionaires
  • Both became millionaires early in life
  • Both have filed bankruptcy
  • Both became millionaires again
  • Both are best-selling authors
  • Both sold books from their car
  • Both used debt for real estate
  • Both invest in real estate
  • Both love real estate
  • Both are friends


Oddly enough, they probably have more similarities than they do differences, but here they are:

  • Kiyosaki uses debt; Ramsey does not
  • Kiyosaki invests in commodities like gold; Ramsey does not
  • Kiyosaki uses debt for real estate; Ramsey does not
  • Kiyosaki thinks mutual funds are bad investments; Ramsey does not
  • Kiyosaki is inconsistent; Ramsey is not
  • Kiyosaki is contradictory; Ramsey is not
  • Kiyosaki encourages risk; Ramsey does not

Thoughts on Ramsey

Ramsey has taught a very consistent message for over 25 years. Almost all his teachings are clearly laid out for you on his website, if not on his radio show or in his books. He seems very transparent, and I have been a fan of Ramsey for years.

Related: How to Become a Millionaire Making $40k a Year

But to be fair, let me mention some pros and cons.


Ramsey knows what it’s like to be broke. He also knows what it’s like to be rich, to get rich, and stay rich.

The methods he teaches are clearly laid out in his books, his website, and his radio show. It is a clear and consistent message: “Rich people don’t borrow money, so you shouldn’t either, unless you want to be broke.”

He is a stubborn enemy of debt, and that’s a good thing. That mind-set has worked for many people, including most millionaires.

He’s done some of the biggest studies on millionaires ever, and all of his findings corroborate the same message: stay out of debt.

In his own life, he refuses to use debt. He practices what he preaches. He teaches people to pay cash, so he does, too. When he invests in real estate, he does so with cash and not debt.

If you follow his methods, you are sure to start winning with money. Soon you’ll be on your way to building real wealth. I have experienced some wins in my own life.


The major flaw with Ramsey is this: He didn’t become wealthy by implementing the steps that he teaches everyone. He became wealthy because he started a business that became a success.

Dave Ramsey is an entrepreneur; he’s not an employee. He didn’t build his wealth by working for someone driving a forklift for 40 years and saving his pennies.

I’m not picking on Dave Ramsey; I’m just being honest.

Dave Ramsey is an entrepreneur. It was true when he started, and it’s still true today. He built his wealth by building a successful business.

Yes, his business involves coaching people and teaching what he’s learned from millionaires. It’s just not something he did to become a millionaire.

What Ramsey did do was provide a service he saw a need for in the market place. He added value to people’s lives and made a profitable business out of it.

That’s not a bad thing, though. It doesn’t undermine anything he teaches; it doesn’t mean that what he teaches doesn’t work; it only means that it’s not necessarily what he did. But that’s because he’s an entrepreneur, and his audience is middle-class working Americans.

The advice Ramsey gives works, but it’s for employees . . . not entrepreneurs.

Thoughts on Kiyosaki

Kiyosaki seems to teach a contradictory and inconsistent message; he strikes me as a fraud. His methods are not specific because, quite frankly, he’s a little shady. But let’s look at some pros and cons.


Kiyosaki knows what it’s like to be broke. He also knows what it’s like to be rich (he’s obviously a rich and successful entrepreneur).

He’s had huge success with book sales, and teaches a mind-set that is entrepreneurial focused. That’s a good thing if you aspire to be an entrepreneur.

If you have a strong desire to be financially independent, he might give you some interesting ideas to consider.

Related: Become a Millionaire Before You’re 50


Kiyosaki has filed bankruptcy several times; I think one of his business’s filed just recently.

I can’t say I agree with him on debt, nor would I live in my car because I refuse to work for somebody. If I were to lose my job or business, I would definitely go work for someone to provide for my family. I’d be a garbage man if I had to! But maybe that’s just me.

I admit, his attitude about life and money are quite different and perhaps inspiring, but his methods are not at all clear. There’s nothing tangible about what he teaches (as far as I can tell).

I believe his lackadaisical attitude toward debt and risk causes him to win big, but also causes him to lose big (hence all the bankruptcies).

His message might be positive, but his methods seem risky, shady, and ambiguous.

I’m still not a huge fan of him using network marketing companies to promote and sell his books, especially when he readily admits that “network marketing wasn’t for him” but goes on to write a book as to why “network marketing should be the business of the 21st century.” I don’t know . . . it’s gonna be hard for me to get over that one.

Everything about him strikes me as shady, I guess.

Final thoughts

At the end of the day, it all depends on you. The only person who can decide your fate is you.

If you want to be an employee for the rest of your life, but still want a chance at building wealth, Dave Ramsey is your guy. You can certainly build wealth doing that and most millionaires have.

However, if you want to be financially independent right now, you have to start thinking and acting like an entrepreneur. You have to build a successful business. After all, isn’t that what Ramsey did? He saw a need and capitalized on it.

Whether you need motivation as an employee, or inspiration as an entrepreneur, Ramsey is your guy. You can do what he did, or do what he teaches. In fact, you can probably do both; and if that’s the case, you’ll win regardless.