‘Pay yourself first’
The Richest Man in Babylon: Original 1926
This book teaches us about managing personal finances through a series of interesting tales. The story of the book revolves around a fellow named Arkad who lives in Babylon. Arkad is a man who was poor once followed principles of making wealth and become the richest man in Babylon. Let’s uncover the book to know how he made his fortune.
Author: George Samuel Clason
George Samuel Clason was born in Louisiana, Missouri on November 7, 1874 and died in Napa California on April 7, 1957.
Clason was a soldier, businessman and writer.
Clason started two companies, the Clason Map Company of Denver Colorado and the Clason Publishing Company. The Clason Map Company was the first to publish a street map book of the United States and Canada, and collapsed in Great Depression.
George Clason is popular for his writings about being frugal and personal finance. He started writing pamphlets using the parables that were set in ancient city Babylon. These writings were distributed by Banks and Insurance Companies. The popular articles were collected and published as a book “Gold Ahead” was renamed “The Richest Man in Babylon”.
7 Cures For A Lean Purse:
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Arkad recommends adhering to 7 guidelines to get rich:
1. A Part of All You Earn Is Yours To Keep:
Arkad advises, ‘pay yourself first.’ He asks to keep at least one tenth of earning to yourself. Paying yourself simply means save. He also emphasizes on being consistent with saving regardless how much you save.
The saving should not be short of one tenth of your earnings. The savings gives you joy and will motivate you to earn more. You will understand that the real fun is in sparing money and not spending it. By spending we can fulfill our temporary wishes and needs but by saving we can accomplish long term objectives.
Arkad warns us not to work more than capacity. Do not be more frugal and try to save more than needed. He suggests to start creating wealth with established source of income.
2. Control The Expenses.
Desires grows with income. We should not get confuse among necessities and desires. One should fulfill his needs but should limit his desires as they are limitless. Having wants more than income will cause our income to evaporate. Live by your gaining and control costs.
Attempt to control expenses yet remember not to cut our essential. Try not to over strain or attempt to spare a lot as it might take away joy of living. The aim should be hundred percent appreciated value for each coin spent.
3. Make Thy Gold Multiply:
Our spared fund won’t make us rich however we can get rich by wisely investing funds. Arkad proposes taking guidance from individuals whose everyday work is taking care of money. He Insists on investing our saved money to create an income source and increase our funds. He says the gold will multiply if you discover the ideal spot to invest in.
Let the investments to grow, reinvest the returns of investments and keep reinvesting. After making adequate wealth you can rest and enjoy the life.
4. Guard The Treasure :
Arkad warns the gold in the man’s purse should be guarded with firmness or else be lost.
Invest capital where your principal will be safe, can be reclaimed and earn fair returns. Investment evades the person who contributes it to unfamiliar business and one don’t have abilities in.
You should not invest in the schemes having impossible earnings and romantic desires.
You must not be overconfident and take unnecessary risks. Start with small capital and acquire the skill, later you can manage the larger capital easily.
5. Own The Own Home:
No man’s family can enjoy the life unless they have a home. It is not difficult to buy a home for a well intentioned man. Here Arkad underlines the importance of having a home. It is important to have a own shelter so that we do not need to pay the rent but just minor taxes.
Having a home makes our family members settle and gives assurance of safety. The family members speak well about you and respect you.
6. Insure a Future Income:
Arkad says look at the aged and remember you are going to be numbered among them in the days to come. He advises to ensure an income source for the future. Arkad asks to make provision to secure an income source for your family if anything goes wrong with you.
He suggest to park the savings such way that we can get continues income when we no longer be able to work. We will not be young forever to earn for our family. Arkad underlines the need of planning for retirement and ensuring availability of ample funds for retired life.
7. Increase The Ability To Earn
The more wisdom we know, the more we can earn. Arkad suggests putting resources into yourself so as to build the capacity to gain more.
We as a whole have sufficient opportunity to get rich you simply need to accumulate the knowledge and acquire the essentials of the wealth.
Arkad advises to keep honing skills, gather wisdom and expand earnings power. You need to have a killing instinct to get rich just a wish to get wealthy will not work.
9 Takeaways from The Richest Man In Babylon:
Goddess of Fortune:Everyone wants to be fortunate but fortune favors the man of action.
Arkad considers the goddess of fortune kind who helps the needy and rewards those we deserve.
The book tells us a story how a fellow from Babylon missed a brilliant opportunity of making fortune because of procrastination. He underlines how good luck flees from dilly-dallier.
The opportunity is a haughty goddess who wastes no time with those who are unprepared.
It gives us a message the goddess of fortune helps those who are well prepared and accept the opportunities without delay.
Desire to Get Rich:
The story begins with two poor friends Bansir and Kobbi. Kobbi is the best performer in Babylon and Bansir has incredible chariots making skills. Both of them dominate in their work yet poor since they never wished to be affluent however excellent in work.
Arkad tells his friends the man’s riches isn’t in the purse he carries but the stream which fills the purse constantly. An income that continues coming into your pocket regardless of what you do.
Wealth Is Power:
Arkad says riches is an influence which can reinforce whatever you do. You can purchase a lavish home, extravagant garments, adventure the world, purchase gold, and do noble cause to get favors from Gods.
Arkad emphasizes on distinguishing among needs and wants. He encourages creating budgets to control the costs. The spending plans will be the main associate who will assist you with making fortune.
Creating spending plans and following strictly is the key to riches.
The book says gold raises the position of its possessor among other people but brings responsibilities. The possessor fears it may be robbed or tricked away from him. It also brings a feeling of power and the ability to do good.
At the point when we procure riches individuals around us will request help. We need to be very cautious while helping others. We should help only those who has the ability and integrity to repay. In the event that you want to help a friend to do as such that won’t bring the friend’s burden upon yourself.
The book has a story of a camel dealer who has driven away from his home and town because of miserable borrowings. How he repays his debts following the core principle of wealth.
Hopeless debt is like a deep pit into which one may descend quickly and struggle for many days to come out. A deep pit of restless nights and sorrows.
These debts are really going to haunt you for all the life.
Thus, it encourages debts for wise purpose and under the guidance of experts.
Walls of Protection
Babylon stood strong for decades behind its impregnable walls. These walls of protection represent the best example of the man’s need and desire for protection. We cannot afford to be without adequate protection.
We should protect ourselves from unexpected tragedies that may enter any door and set the fire. We can build a wall of insurances to protect our world from any mishap. Hence the story underlines the significance of insurances.
Soul of A Rich or Poor:
It says “The soul of rich solves while soul of a poor whines.”
If you have a soul of a rich person you will find a way to acquire wealth on the other hand poor souls keep whining for their misfortunes. A rich soul will make fortune regardless where it begins. If you are a poor soul you are going to lose the fortune now or then.
Finally, its you who is going to decide if you have the soul of a rich or a poor.
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