Why Should I Read | The Richest Man in Babylon
If you’re like me, you too have tried to “get into” a finance course or personal finance book. You may be realizing, like I am as well, that a failure to learn good financial principles compounds throughout your life and that not knowing what you’re doing is an incredibly bad idea.
Last week we talked about why stories drive change. This book, The Richest Man in Babylon by George S Clason, presents useful financial principles in story form. I won’t reprint the stories here, so you’ll have to settle for a quick bullet-ed list of the “7 cures for a lean purse.” The audiobook version is $1.95 and only 4 hours long too!
This book was published in 1926 a few years before the great depression. Clason was the owner of a prominent map company and applied the principles he writes about throughout his life.
This small paperback is the seminal work on personal finance and entrepreneurial thinking. These lessons address topics such as avoiding debt, seeking out mentors and protecting assets. The short, allegorical book struck a chord with Depression-era readers, who clamored for its easy-to-read financial advice and wisdom on building wealth.
This book is concise, it delivers financial principles in story form, and it provided a basis for many authors and speakers of the 20th century as they wrote books and delivered seminars on financial success.
You may actually prefer a change of pace from the dry financial tomes that tell us how to pay down debt, buy a home, invest in stocks or other strategies like flipping houses or starting a business. Then the stories of Arkad, Dabasir, and Sharru Nada set in the exotic gardens of Babylon or the deserts of the Middle east will be a welcome change of pace.
If that sounds interesting, and you want more than these 7 quick points to overcome being broke we are going to cover, then go get this book on amazon for 4 dollars for a paperback or 1.95 on audiobook.
Think about this for a second, Og Mandino, one of the most successful personal development speakers and authors of the 20th century called this book the greatest text on personal finance and thrift of all time and it’s 1.95 on amazon. The problem isn’t lack of information, people, it’s lack of implementation.
Another personal-achievement expert, Brian Tracy, explained in his book Getting Rich Your Own Way that Clason’s message, despite its age, is still valid today. “The book is a primer on financial success because its principles are simple, direct and effective,” Tracy says. Pulled from Success Magazine, April 13, 2011
Here are the seven bullet points on overcoming a lean purse from the Richest Man in Babylon.
- Set thy purse to fattening
- Specifically, hold 10% of your income for your own future.
- Control the expenditures
- Live on 90% of your income or less and don’t deviate from the budget.
- Make thy gold multiply
- Straightforward, don’t let it sit there, invest wisely. Parable of servants matt 25.
- Guard thy treasures from loss
- Invest only where the principle is safe, where it may be reclaimed if desirable, and where you earn reasonable interest. Also seek counsel from wiser heads when investing.
- Make of thy dwelling a profitable investment.
- Own your home. Here’s the thing, I take issue with this one to some extent but in almost all cases it’s better to own if you can do it without debt.
- Insure a future income
- Provide in advance for your family and/or retirement
- Increase thy ability to earn.
- Build your capacity, study and become wiser and more skillful, and act as though you respect yourself.
Those are the 7 cures for a lean purse from The Richest Man in Babylon. The audiobook is 4 hours long and costs less than a cup of coffee. If you can’t handle some Thees and Thous don’t bother, but with experience comes wisdom and many experienced individuals highly recommend this book.