Author: George Samuel Clason
|The Richest Man in Babylon (1926) is a finance management book. It describes ways to generate, protect and invest money through parables from ancient Babylon.|
Detailed Summary of The Richest Man in Babylon
The Richest Man in Babylon Summary will take you on a journey full of financial advice from the ancient Babylonians who are considered to be the first people to discover the universal laws of prosperity.
In this short classic based on only one hundred pages, you will learn how to earn more money, pay your debts, and save and invest wisely. The stories are shared through the voice of a character named Arkad who becomes transforms his life from rags to riches. He was the son of the merchant but he works like a trojan and become the richest man in Babylon.
The advice is divided into two main factors including seven cures and five laws of gold. The first factor explains ways in which one can increase his income and the second one explains how to protect and invest it.
The secrets to not let finances be a burden for you include living below your means, saving up, investing after research, seizing opportunities, and not getting into debt. In the Richest Man in Babylon Summary, we will explore these steps in detail. So let us dig in and learn how to get our budget in order!
The Richest Man in Babylon Summary Key Points
Are you an unthrifty person who spends extra money on products that are less or no use? Are you interested to know how to manage your finance?
There are two ways to cope with this problem. Firstly, the straightforward and easiest solution is to save at least 10% of your income. Stop spending much money on unnecessary items. And the second thing is to stop being procrastinated. The more you become procrastinate the more you become lazy and far from your goal. Do your things on time to earn more. Because you can not achieve success until you beat procrastination within you.
Let’s dive into the key points to learn how to become the richest man and woman in Babylon!
You might be interested in reading Your Erroneous Zones Summary.
Don’t burn a Hole in your Pocket
Some people spend money on unnecessary and luxurious purchases for instant pleasure because they feel as if the money was burning to get out of their pockets. This is never a wise thing to do. Because as soon as that feeling wears off you will see how useless your purchase is.
Having spent that money on something unnecessary wouldn’t facilitate you in the future. To combat this, Arkad our protagonist advises us to calculate our annual income and save up to ten percent of it. If we put aside this much money we will be able to save up a handsome amount that can secure our future and save up in case of financial mishaps.
Earning more money sounds attractive and there is no harm in wanting to earn more but saving up more money is as effective as earning more. After all, the saved amount will go into your wallet too. The author advises the readers to not confuse their necessary expenses with their desires. Whatever your income, always live below the means.
Invest but Safely
Now that you’ve started to save, you would want to invest. There are many intricate details in the world of investment. Before investing one should always research. Arkand claims that it is not wise to just jump right in and go for larger earnings.
For example, many people nowadays invest in mutual funds and you might think that high-cost mutual funds are good but they have a greater expense ratio that you will need for managing these funds.
Today, there are several ways to invest including bonds and real estate. This is why it is important for you to completely understand where and how to invest and on what terms. It is not shameful to admit that you do not know about investments. True wisdom lies in your willingness to learn.
Steer Clear from Financial Debt
Taking debt, in general, is a bad idea. Studies even show that people are more inclined to borrow money for the things they want instead of the things they need. If you are already following the advice in The Richest Man in Babylon Summary key points and do not have to re-pay any debt then you are lucky. But if you are in debt it might be hard to get out of it completely.
Just like Greece in the Eurozone crisis. In order to pay back debt, the government had to postpone development plans and had to stop investing in education, infrastructure transport, and so on. This resulted in economic instability.
If a country is not investing in its future how can it pay back the debt? Soon the state will run short of it and the country can go to default. This is like reaching a dead end with no possible easy solutions. This is why the author advises his readers to not take money from anyone in the first place.
In the words of Seneca: “Luck is what happens when preparation meets opportunity. “Luck and chance are not the same things. People come across certain blessings by chance but they do not become ‘lucky’ without hard work.
The key to becoming luckier according to the author is working hard and seizing an opportunity whenever you can. Some of the most successful people in the world have not studied at Harvard or Oxford. Those are the ones who work hard, practice, and grab the bull by its horns.
Keep a positive perspective. Try to look at an opportunity as a sign of abundance and not something too hard to achieve.
The Richest Man in Babylon Quotes
“Opportunity is a haughty goddess who wastes no time with those who are unprepared.” –George S. Clason
“Advice is one thing that is freely given away, but watch that you only take what is worth having.” –George Clason
The Richest Man in Babylon Summary Review
The Richest Man in Babylon Summary is full of financial wisdom. Whether you want to learn how to save and invest or just how to get out of debt this book will provide you with some practical and easy advice. There are interesting parables of merchants, tradesmen, and herdsmen to keep the reader interested.
To Whom I Would Recommend The Richest Man in Babylon Summary
- To anyone who is just a beginner at managing and saving money.
- To the millennial who wants to save up for his start-up business.
- And to anyone who is in debt and needs to find a way to get out of it.