The Richest Man in Babylon

in Book Reviews,Money,Reviews

The wealth building book The Richest Man in Babylon is a classic for good reason. When George Clason published the book in 1926, it was already well known as a collection of pamphlets that had been used by banks and insurance companies as aids to their customers. The stories were collected together in the book that became known as The Richest Man in Babylon.

In simple language, the book tells stories of citizens of ancient Babylon, about their struggles to live day to day, to save money and build wealth. The dialog of the original (it was updated to more modern language in 2004) is a bit stilted and hokey, but for me that is part of the charm.The stories of Bansir, Arkad and Rodan (to name a few) are engaging and inspiring. The opening story is about Bansir, a chariot maker of ancient Babylon. He’s a good chariot maker but he can barely rub two dimes together. He goes and sees his old school chum Arkad, who is considered by many in the city to be the richest man among them. Arkad kindly tells him (and some other childhood friends) the story of his road to wealth. In later chapters Arkad expands on his philosophy and then other people take up the tale and focus the lens on different parts of wealth building.

For people hoping to attract wealth into their lives, this little 144 page book is invaluable. As many financial counselors will tell you, your own income is your best and, in the beginning, your only wealth building tool. How do you tap into the potential of your own paycheck? It is a secret of the ancients — spend less than you make! If I had to sum up the book in one sentence it would be this: Live below your means. Do that and wealth will flow.

For many people getting to a place where they can truly use their income to produce wealth means getting debt help, finding debt reduction strategies and learning, step by step how to clear debt. There is a lot of advice out there to help you begin the journey of debit consolidation. In a nutshell: a written budget and a little bit of money (even $25) sent to the smallest of your debts will get you on the road to building wealth.

The book states that there are Five Laws of Gold. In the story Arkad gives them to his son on a stone tablet along with a bag of gold and tells him to go seek his fortune. Here they are (in the language of the 1926 version)
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.
2. Gold laboreth diligently and contentedly for the wise owner who finds for it profitable employment, multplying even as the flocks in 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 or romantic desiresĀ  in investment.

As you can see, there is nothing revolutionary about the advice. It is very commonsense advice. Save money; invest it cautiously; get rich slowly. It is revolutionary, though because most of us are not taught these principles as children. No one teaches us how to handle money and so we don’t learn to save or invest. We live paycheck to paycheck and play the lottery hoping to get rich that way. Instead, you can do what I did — pick up this valuable little book and read it until you truly understand its message.