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The Richest Man In Babylon by George S. Clason

Rating: 8/10

Date Read: April 5, 2021

Buy on IndieBound | Amazon (affiliate link)

My Thoughts

Before I read this book I was not sure what to expect. So, this summary for someone in a similar position.

"The Richest Man In Babylon" is a collection of short and educational stories. These stories tell you about people living in ancient Babylon. Each story teaches you a small lesson on how to make progress towards financial stability.

You could say that this book is about getting rich, but in reality, it is about discipline. The rules are simple. If you are disciplined enough to implement them, success awaits you.

By reading this review you will get the most of the book, yet, I still recommend you give it a read. You are very likely to complete it in a few days and actually enjoy it.

Summary

There are 10 chapters in this book. 10 little stories that have a common theme.

  • Save at least 10% of your earnings

  • Control your spendings. What you may call essential is probably not.

  • Invest your savings

  • Invest only in the thing you know about, or with someone who knows what they are doing.

    • The easiest way to do that these days is by buying ETFs.

Some points are specific to different stories. For example:

  • Learn, invest in yourself to increase your earning power.
  • Keep a part of your savings safe, so that in the extreme case where your investment doesn't pan out, you are not left with nothing.

Highlights

Foreword

Our acts can be no wiser than our thoughts. Our thinking can be no wiser than our understanding.

The Man Who Desired Gold

“a man’s wealth is not in the purse he carries. A fat purse quickly empties if there be no golden stream to refill it.

Thou makest me to realize the reason why we have never found any measure of wealth. We never sought it. Thou hast labored patiently to build the staunchest chariots in Babylon. To that purpose was devoted your best endeavors. Therefore, at it thou didst succeed. I strove to become a skillful lyre player. And, at it I did succeed. Note: Goals of earning more and becoming mored skillful are different

The Richest Man in Babylon

study, did not our wise teacher teach us that learning was of two kinds: the one kind being the things we learned and knew, and the other being the training that taught us how to find out what we did not know?

Advice is one thing that is freely given away, but watch that you take only what is worth having. He who takes advice about his savings from one who is inexperienced in such matters, shall pay with his savings for proving the falsity of their opinions.’

You first learned to live upon less than you could earn. Next you learned to seek advice from those who were competent through their own experiences to give it. And, lastly, you have learned to make gold work for you.

Would you call a fisherman lucky who for years so studied the habits of the fish that with each changing wind he could cast his nets about them? Opportunity is a haughty goddess who wastes no time with those who are unprepared.” Note: Везет тому кто везет. The more I work the luckier I get.

When I set a task for myself, I complete it. Therefore, I am careful not to start difficult and impractical tasks, because I love leisure.”

“Counsel with wise men. Seek the advice of men whose daily work is handling money.

A small return and a safe one is far more desirable than risk.

Seven Cures for a Lean Purse

The First Cure — Start Thy Purse to Fattening

The Second Cure — Control Thy Expenditures

That what each of us calls our ‘necessary expenses’ will always grow to equal our incomes unless we protest to the contrary.

The Third Cure — Make Thy Gold Multiply

“I tell you, my students, a man’s wealth is not in the coins he carries in his purse; it is the income he buildeth, the golden stream that continually floweth into his purse and keepeth it always bulging.

The Fourth Cure — Guard Thy Treasures from Loss

be not too confident of thine own wisdom in entrusting thy treasures to the possible pitfalls of investments. Better by far to consult the wisdom of those experienced in handling money for profit.

Guard thy treasure from loss by investing only where thy principal is safe, where it may be reclaimed if desirable, and where thou will not fail to collect a fair rental.

The Fifth Cure — Make of Thy Dwelling a Profitable Investment

Therefore, do I recommend that every man own the roof that sheltereth him and his.

The Sixth Cure — Insure A Future Income

Therefore do I recommend to all men, that they, by wise and well thought out methods, do provide against a lean purse in their mature years.

The Seventh Cure — Increase Thy Ability to Earn

“Preceding accomplishment must be desire. Thy desires must be strong and definite. General desires are but weak longings.

For a man to wish to be rich is of little purpose. For a man to desire five pieces of gold is a tangible desire which he can press to fulfillment. After he has backed his desire for five pieces of gold with strength of purpose to secure it, next he can find similar ways to obtain ten pieces and then twenty pieces and later a thousand pieces and, behold, he has become wealthy. Note: Set a tangible, reachable goal.

In learning to secure his one definite small desire, he hath trained himself to secure a larger one. This is the process by which wealth is accumulated: first in small sums, then in larger ones as a man learns and becomes more capable. Note: Starting with small amounts will teach you to deal with larger

“The more of wisdom we know, the more we may earn. That man who seeks to learn more of his craft shall be richly rewarded.

“Thus the seventh and last remedy for a lean purse is to cultivate thy own powers, to study and become wiser, to become more skillful, to so act as to respect thyself.

Meet the Goddess of Good Luck

The spirit of procrastination is within all men. We desire riches; yet, how often when opportunity doth appear before us, that spirit of procrastination from within doth urge various delays in our acceptance.

“Good luck, we do find, often follows opportunity but seldom comes otherwise

Good luck can be enticed by accepting opportunity. “Those eager to grasp opportunities for their betterment, do attract the interest of the good goddess. She is ever anxious to aid those who please her. Men of action please her best. “Action will lead thee forward to the successes thou dost desire.” Men of action are favored by the goddess of good luck.

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 earngs to create an estate for his future and that of his family.
  2. Gold laboreth diligently and contentedly for the wise owner who finds for it profitable employment, multiplying even as the flocks of the field.
  3. Gold clingeth to the protection of the cautious owner who invests it under the advice of men wise in its handling.
  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 skilled in its keep.
  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 own inexperience and romantic desires in investment.

“Wealth that stayeth to give enjoyment and satisfaction to its owner comes gradually, because it is a child born of knowledge and persistent purpose.

The Gold Lender of Babylon

evening he did hear the ox bemoaning to the ass

If you desire to help thy friend, do so in a way that will not bring thy friend’s burdens upon thyself.”

“The safest loans, my token box tells me, are to those whose possessions are of more value than the one they desire.

“Then be not swayed by foolish sentiments of obligation to trust thy treasure to any person. If thou wouldst help thy family or thy friends, find other ways than risking the loss of thy treasure. Forget not that gold slippeth away in unexpected ways from those unskilled in guarding it.

The Camel Trader of Babylon

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 but a slave?’

Where the determination is, the way can be found

End Note

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