An Opportunity To Learn Financial Advice From The Richest Man In Babylon
George Clayson's The Richest Man in Babylon is considered the bible of financial freedom. This book presents timeless money rules and laws that anyone can use.
The Book in Three Sentences
Save at least 10 percent of everything you earn and do not confuse your necessary expenses with your desires. Work hard to improve your skills and ensure a future income because wealth is the result of a reliable income stream. You cannot arrive at the fullest measure of success until you crush the spirit of procrastination within you.
The book in itself belongs to a category that I would like to call the philosophy of making money as it will teach you about the habits one has to adopt to gain wealth. Let it be how to attract good luck or practical advice on money lending the book has it all and that's what makes it unique
The central point of the book is Arkad, the richest man in Babylonian history and the book revolves around his teachings that have benefited individuals across generations from the history of Babylon.
So one might wonder what his teachings made so many men successful. Glad you asked, here's a brief rundown of the things taught in the entire book -
Why Are You Not Wealthy?
Simple answer: you never thought of being it, you were content with what you had or were led into believing it is what you ever will have
A man willing to commit suicide has conviction, (sorry for the dark analogy ) likewise if you want to be rich, believe and think you will, because it sets the stage for the habits that follow such a person
The book tells us that making money is just like any skill: it can be acquired, but for that time and study will be required
How To Study For Being Rich?
For that, one requires guidance and experience, guidance for the field we choose to dwell in and experience from dwelling there persistently is what creates success
As the book tells us from the first experience of Arkad, where he gave a Brickmaker his hard-saved money so that he could buy jewels to earn a profit but he forgot to ask himself a very important question, how much can a Brickmaker know about precious stones?
Unsurprisingly the venture failed as all he got was pieces of glass sold to him as jewels
The message is clear - learn from our experience and then learn from others who are more knowledgeable than we are in the same field
Moving on to the chapters we see that each one of them has a proverbial message for the reader which collectively, I think are necessary for one to learn after deciding to be rich, and hence, I will expand upon them for an easy understanding
“It costs nothing to ask wise advice from a good friend.”
Part Of All You Earn Is Yours To Keep
No matter what we earn, it's always for others as we, at the end of the day, give it to others for good or services and it becomes their slave
The book tells us to always save something for ourselves no matter how small it may be because then that money becomes our slave and its children and their children work for us
HOW DOES THAT WORK?
It's explained in the following lesson:-
Seven Cures For A Lean Purse
1 - Start by thy purse fattening
To make money you need money, so start by saving what you have and don't let it be less than 1/10th of what you earn
2 - Control thy expenditures
Make a list of all the things you think of buying and cross out the ones that you don't need till you can save at least the 1/10th mentioned above
3 - Make Thy Gold Multiply
Invest and let the gold slaves work for you to get more slaves, it is the compound effect in action!
4 - Guard thy treasure against loss
When going on ventures be careful as tragedy is found in every corner of life, better safe than sorry
5 - Make thy dwelling a profitable investment
if you live on rent, a part of your income goes to the landlord but when you own where you live, it becomes a place of happiness and content which adds value to life
6 - Insure Future income
Always save something for when you're old for a lean purse of a man no longer able to provide for his family is a sore tragedy
7 - Increase thy ability to learn
Just like you are doing now, have the courage and desire to learn something new and known by few for which the goddess of luck will reward you with a fortune known by few
Men Of Action Are Favored By the Goddess Of Good Luck
The chapter starts with Arkad discussing with his fellow mates how to attract good luck
one suggests that gambling is a way to earn money quick to which he replies :
"What reason have we to feel the good goddess would take that much interest in any man's bet upon a horse race? To me, she is a goddess of love and dignity whose pleasure is to aid those who are in need and to reward who are deserving"
As the conversation proceeds some people tell their tales of how they had a great loss when they didn't seize an opportunity because of doubt or sheer procrastination
And the Conclusion they came to be was :
To attract good luck to oneself, it is necessary to take advantage of opportunities as good luck can only be incited, by accepting them
Now having learned how to procure gold, the book moves on to the next chapter which deals with safekeeping and managing, the laws are very similar but there exist subtle differences so do pay attention to that
The Five Laws Of Gold
1. Gold cometh gladly and in increasing quantity to any man who will put by not less than one-tenth of his earnings to create an estate for his future and that of his family.
As mentioned above, a person should put away 10% of his or her income for the future as a bare minimum
2. Gold laboreth diligently and contentedly for the wise owner who finds for it profitable employment, multiplying even as the flocks of the field.
when you invest your money well, your money will simply make more money
3. Gold clingeth to the protection of the cautious owner who invests it under the advice of men wise in its handling.
take caution in investing, or at least be informed. ( nowadays the internet is here to save the day !)
4. Gold slippeth away from the man who invests it in businesses or purposes with which he is not familiar or which are not approved by those who are skilled in its keep.
Listen to the advice of those more skilled than you and think for yourself as to what is the best
5. Gold flees the man who would force it to impossible earnings or who followeth the alluring advice of tricksters and schemers or who trusts it to his inexperience and romantic desires in investment.
The worst option is to spend resources on anything that promises absurdly good returns ( gambling), or anything that you're heavily pressured into buying ( say the society does like phones a lot, maybe it should get one, sounds familiar doesn't it ). These investments are scams and won't stand up to serious research.
The five rules are all you need to know: save money, do some research, and only invest in the absolute truths from that research.
Better A Little Caution Than Regret
The chapter focuses on the story of Rodan a spearmaker who recently acquired a large sum of gold, to the dismay his brother-in-law is pressurizing him to invest in one of his ventures
To resolve this conundrum of investing and not investing, he visits his friend Mathon a money lender who advises the following :
The safest loans are those where their possessions are of more value than the ones they desire
One other class is that earns, they too can pay back the loans as they are based on human effort
But the others those who neither have property nor assured earning capacity, unless guaranteed by good friends of the borrower are not a wise investment
and says they if they borrow for purposes that bring money back to them it's okay but if they borrow because of their indiscretions, I warn thee to be cautious if thou wouldst ever have any thy gold back in hand again
the dialogue ends with Rodan determined to only lend money if he sees that it can be duly paid back to him
If you desire to help thy friend, do so in a way that will not bring thy friend's burden upon thyself
Where Determination Is, The Way Can Be Found
the story with the help of a slave tells about the power of our mind :
if you think you have no way of doing it, everything seems to look like it won't work and you lose hope, think you'll make it and that might be the case
The soul of a free man looks at life as a series of problems to be solved and solves them, while the soul of a slave whines, "what can I do, who am I but a slave ?"
THE CLAY TABLETS FROM BABYLON
These tablets hold a record of Dabasir, an insolvent Ex-Slave looking to build his life in Syria
In the record, he tells his story of paying his debts by :
Saving one-tenth of what he earns
Keeping 2/10th for his debts and equally dividing them to all he owes them to
and using the rest for necessities
As expected, the debt was paid by using these three simple rules that led to him living a happy and prosperous life!
The Luckiest Man In Babylon
In the last chapter, we are met with the story of Arad Gula a slave whose hard work made him his fortune
one instance that I particularly was very inspiring to me,
Arad Gula was in a cage and was being shown up in the slave market, if he was not bought it would spell disaster for him as he would be forced to work in construction for the city wall, the answer to which was him yelling :
"Look at me, I am young strong, and l like to work. Give me a chance and I will do my best to earn gold and silver for thy purse "
This statement alone eventually lead him to be a street vendor and later helped him in earning his freedom because of a friend he helped along the way