【Book Summary】 The Richest Man in Babylon by George S. Clason

Details

Title: The Richest Man in Babylon
Author: George S. Clason
ISBN-13: 978-0-451-20536-0
Published Date: 1926

Author

George Samuel Clason (November 7, 1874 - April 5, 1957) was an American author best known for writing a series of informational pamphlets about being thrifty and how to achieve financial success. He started writing the pamphlets in 1926, using parables that were set in ancient Babylon. Banks and insurance companies began to distribute the parables, and the most famous ones were compiled into the book The Richest Man in Babylon - The Success Secrets of the Ancients. He is credited with coining the phrase, "Pay yourself first".

Source: Wikipedia

The Richest Man in Babylon

1. The Man Who Desired Gold

Bansir, a chariot builder, and his best friend Kobbi, a musician, both were talking about their dream of being wealthy.
After talking to each other, both decide to not just talk but to take action by seeking wisdom from the richest man in Babylon, Arkad.

2. The Richest Man in Babylon

Arkad, a poor scribe, receives an order from Algamish, a wealthy money lender, which was difficult to complete in a given time-frame.
Arkad strikes a bargain to complete the task within the time-frame if Algamish tells Arkad how he became rich.
Algamish tells Arkad, “I found the road to wealth when I decided that a part of all I earned was mine to keep. And so will you.”
Algamish continues to explain and advises Arkad to save 10% whatever he earns no matter how small the amount was and invest it wisely.
Arkad follows this advice, gradually accumulating wealth and investing the money wisely.
After years of encounter; Arkad becomes understood how to:
1. live upon less than you could earn;
2. learned to seek advise from those who were competent through their own experience to give;
3. and make money work for you.
Algamish becoming old; makes Arkad his partner to manage his land and continues to accumulate wealth.
After Arkad became rich, people started asking Arkad for advise which he gladly gave by passing along what he learned from Algamish.

A PART OF ALL YOU EARN IS YOURS TO KEEP

3. Seven Cures for a Lean Purse

Upon the request from the king, Arkad gave a lecture to 100 men how he accumulated wealth by following seven cures for a lean purse.

The First Cure: Start thy purse to flattening

“For each ten coins I put in, to spend but nine.”
Summary: Save at least 10% of your income.

The Second Cure: Control thy expenditures

“Budget thy expenses that thou mayest have coins to pay for thy necessities, to pay for thy enjoyments and to gratify thy worthwhile desires without spending more than nine-tenths of thy earnings.”
Summary: Avoid wasteful spending.

The Third Cure: Make thy gold multiply

“To put each coin to laboring that it may reproduce its kind even as the flocks of the field and help bring to thee income, a stream of wealth that shall flow constantly into thy purse.”
Summary: Invest wisely.

The Forth Cure: Guard thy treasures from loss

“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. Consult with wise men. Secure the advise of those experienced in the profitable handling of gold. Let their wisdom protect thy treasure from unsafe investments.”
Summary: Protect your wealth from losses and seek expert advises.

The Fifth Cure: Make of thy dwelling a profitable investment

“Own thy own home.”
Summary: Own a home to reduce the cost of living.

The Sixth Cure: Insure a future income

“It behooves a man to make preparation for a suitable income in the days to come, when he is no longer young, and to make preparations for his family should he be no longer with them to comfort and support them.”
“Provide in advance for the needs of thy growing age and the protection of thy family.”
“No man can afford not to insure a treasure for his old age and the protection of his family, no matter hoe prosperous his business and his investments may be.”
Summary: Save and invest for retirement.

The Seventh Cure: Increase thy ability to earn

“Proceeding accomplishment must be desire. Thy desires must be strong and definite.”
“To cultivate thy own powers, to study and become wiser, to become more skillful, to so act as to respect thyself.”
Summary: Have the desire to acquire new knowledge and skills.

4. Meet the Goddess of Good Luck

If a man be lucky, there is no foretelling the possible extent of his good fortune. Pitch him into the Euphrates and like as not he will swim out with a pearl in his hand. -Babylonian Proverb

In the Temple of Learning, Arkad routinely hosts gathering where large group of people discuss about topics related to wealth.
Opportunities often come disguised as hard work or challenges, and it’s important to recognize and seize them.
Luck often favors those who are prepared and take action.

MEN OF ACTION ARE FAVORED BY THE GODDESS OF GOOD LUCK

5. The Five Laws of Gold

The First Law of Gold

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.

Summary: Wealth increases for those who save at least 10% of their earnings.

The Second Law of Gold

Gold laboreth diligently and contentedly for the wise owner who finds for it profitable employment, multiplying even as the flocks of the field.

Summary: Wealth multiples when invested wisely.

The Third Law of Gold

Gold clingeth to the protection of the cautious owner who invests it under the advise of men wise in its handling.

Summary: People who are cautious in their investment and seek advise will avoid losing their wealth.

The Fourth Law of Gold

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.

Summary: People who invest it in businesses or purposes they do not understand will lose wealth.

The Fifth Law of Gold

Gold flees the man who would force it to impossible earnings or who followeth the alluring advise of tricksters and schemers or who trusts it to his own inexperience and romantic desires in investment.

Summary: People who try to force into impossible earnings or who follow the advice of schemers will lose wealth.

6. The Gold Lender of Babylon

Rodan, a spear maker, awarded gold by the king for his design seeks advise from Mathon, a gold lender, of what to do with the gold he received.
Mathon states that is important to carefully assess borrowers and ensure they are creditworthy before lending money.

BETTER A LITTLE CAUTION THAN A GREAT REGRET

7. The Walls of Babylon

Babylon, surrounded by tall walls protected the city from many attackers throughout many centuries but did not fall because it was fully protected.
The walls of Babylon are an example of man’s need and desire for protection. Desire is inherent in the human race.

WE CANNOT AFFORD TO BE WITHOUT ADEQUATE PROTECTION

8. The Camel Trader of Babylon

Story of Dabasir, a camel trader, who was sold into slavery after being caught after trying to attack unprotected caravans.
Dabasir was sold to a master with four wives and became a camel tender for the oldest wife, Sira.
Sira would occasionally travel to her sick mother and one day let Dabasir escape during a trip after confirming Dabasir’s determination of being a free man when in fact he was still a slave.
Dabasir’s determination to live as a free man, he found a way to return to Babylon, and repaid who he was indebted with the help of Mathon.
Dabasir eventually became free not only physically but the burden of debt by his determination.

WHERE THE DETERMINATION IS, THE WAY CAN BE FOUND

9. The Clay Tablets from Babylon

Five tablets recovered from the ruins of Babylon; a letter sent to the Professor who recovered the tablets and the translator deciphering the old language on the tablet.
Tablet One is the story of Dabasir and how after receiving advise from Mathon, he would save 10% of his income for himself, 70% to provide for security for his family (a home, clothes, food, etc…).
Tablet Two continues to use 20% of earnings for debt repayment.
Tablet Three sums of indebted amount and how Dabasir would repay his debt. Dabasir would repay all those he was indebted and repay them equally.
Tablet Four tells the story of how Dabasir took action by working hard and slowly repaying his debt.
Tablet Five concludes the stroy of Dabasir where he has finally became free of debt after (roughly) 1 year.

10. The Luckiest Man in Babylon

Sharru Nada, once a slave, is traveling back to Babylon with Hadan Galu tells his story during his slavery.
Sharru not wanting to do hard labor for rest of his life, impresses a master, Nana-naid, that was looking for a baker by showing willingness to work and learn.
Sharru makes a deal with the Nana-naid for his freedom, to bake extra honey cake and which 25% of the proceeds would become Sharru’s.
Sharru meets with Arad Gula, a rug merchant and the grandfather of Hadan, was also a slave became a regular customer of Sharru’s honey cake.
Arad became a free men while Sharru was close to earning enough money until Nana-naid lost control of his gambling habit that led to selling Sharru to another master.
Arad tracking down Sharru, decided to buy Sharru’s freedom for an outrageous price became partners and headed to Damascus.
Sharru and Arad enjoyed working hard which led them to prosper with fortune which touched Hadan’s heart.
Hadan decides that working hard is the only key needed to his success.