Borrowing is often associated with something negative. However, renowned author Robert Kiyosaki explains that debt can actually be beneficial if used under the right conditions.
He reveals a method for generating profit through debt. On his personal website, he emphasizes that before jumping into the steps, one must first understand the fundamental difference between good debt and bad debt.

Most people believe that debt is inherently harmful. But Robert argues that this belief is incorrect.

"The new rules of money require you to use debt if you want to become rich. The condition is that the debt must be good debt," wrote the Rich Dad Poor Dad author, quoted on Friday (12/5/2025).

According to Kiyosaki, bad debt refers to loans used for liabilities such as car payments or vacations, because these are not essential priorities and their value decreases over time.

Meanwhile, good debt is used to acquire assets that generate monthly cash flow. Examples include loans for investment properties, venture capital, and other income-producing investments.

"This is the type of good debt. You need a high degree of financial intelligence to use it correctly, but once you do, you can accelerate your ability to make money," he explained.

He then provides an example of how to earn money through borrowing:

The purchase price of a property asset is US$100,000. The payment is made using an US$80,000 loan at 5% interest, with the remaining US$20,000 paid in cash from personal funds.

Using a simple mortgage calculator, the annual expense for this loan amounts to around US$8,500.

Assuming the property generates US$11,000 in yearly income, after expenses are deducted, the net income becomes US$2,500 (US$11,000 – US$8,500). Thus, the return on investment is US$2.500 divided by US$20,000, equivalent to 12.5%.

Kiyosaki states that a 12.5% return is higher than the average return of conventional investments.