Rich Dad, Fool Dad

By Joseph Khattab and Shruti Basavaraj

February 16, 2006

Robert Kiyosaki, author of the uber-successful Rich Dad, Poor Dad series, learned valuable lessons about money from both his real father (Poor Dad) and a wealthy family friend (Rich Dad).

Most of us have only one Dad in our lives (let's call him "Real Dad"). Real Dad is often a great role model, provider, and teacher. But there are limits to what Real Dad knows. Wouldn't it be nice to have a Rich Dad figure in your life like Kiyosaki had? Wouldn't it be nice to know someone who can teach you about investing and saving for retirement?

Well, now you do. Meet your new Fool Dad, Robert Brokamp. Retirement-obsessed Robert heads up the Motley Fool Rule Your Retirement newsletter service, which is designed to give lost souls advice. And not just advice on saving money -- he also gives you ideas on how to make money.

Fool Dad is not going to fix things around the house or coach soccer teams. That's Real Dad's job. But Fool Dad will help you meet your retirement goals, so that you can live in comfort (without needing any handouts from Real Dad).

Now, we all know your Real Dad gives financial advice with the best of intentions. But new Fool Dad Robert Brokamp may know a few things that Real Dad doesn't. Let's see how your Real Dad's advice might compare to Fool Dad's.

Real Dad says ...	Fool Dad says ...
Plan for retirement.	Open up and max out an IRA. You can do that easily with self-directed accounts at a discount brokerage firm.
Save as much as you can.	Open up a high-yielding savings account. ING offers a money market account with a 3.8% annual percentage yield. Bank of America's money market account currently yields 2.25%.
Diversify your portfolio.	It's all about asset allocation among different market caps, industries, and investment vehicles. For example, owning Vanguard Balanced Index Fund (FUND: VBIAX), which counts behemoths like ExxonMobil (NYSE: XOM) and Microsoft (Nasdaq: MSFT) among its top holdings, gives you instant diversification.
Invest in quality stocks.	Hold a few individual stocks so you can beat the market. Value is a time-tested investing strategy. Little-known Alderwoods (Nasdaq: AWGI) has returned 50% since it was featured in the pages of Fool Dad's newsletter. This was a bankruptcy survivor that has proven turnaround management, good operating cash flow, and key performing assets.
Real estate is a good investment.	Real estate investment trusts (REITs) are a necessary component to any diversified portfolio. Just check the performance of Vanguard REIT Vipers (AMEX: VNQ), which beat the market by 17% in the past year on the backs of General Growth Properties (NYSE: GGP) and Vornado Realty Trust (NYSE: VNO) (up 38% and 26%, respectively, over that same time period).