'The Richest Man in Babylon' is a timeless work on financial principles. It is set in the era of Babylon and presents the laws of gold, the ultimate guide to wealth building. Interestingly, most parables hold true to the economic conditions of the present world too. The best part of the messages from Clason's Babylon parables is their simplicity of application. But don't let their simple nature make you believe all of them practise it. So let's look at the golden messages on finance that will help you untangle the financial complex in your life.
9 Messages From 'The Richest Man in Babylon' Every Man Should Know
Begin with savings
The first message is based on the simple fact that you need to save bucks to multiply them. The book emphasizes that once we get credit, we begin paying off all our expenses. It sounds fair, but don't we deserve to be paid for our hard work? A better approach would be to start by paying ourselves with a ten per cent paycheck as savings. Eventually, you can use these bulked-up savings to build your wealth.
The second part of the picture is that we spend on unnecessary stuff. And often, we mistake wants and desires for needs. With the rest of the income in hand, preparing a practical budget to fulfil needs is beneficial. If one feels they are running out of money, then you need to re-consider the list and check if they really fall under your needs category. In the present time, impulsive buying is another factor that may put you in trouble. For instance, if you save a portion of your income for a specific task but end up buying a luxury item due to impulse, it will put you on a negative graph for the coming months to balance it.
Guard your money
The modern version of guarding our savings is making use of banks. Such savings protect you from potential threats. Besides, it's important to have cash savings, as they come in handy in case of emergencies.
Ensure for future needs
Savings are great, but these bucks, when invested in the right way, secure the future. It means putting your money to work. This will give you peace of mind knowing the money multiplies whether you work or rest. To simplify, prioritise building long-term income sources over short-term desire fulfilment.
Action guides luck
It is untrue that some people succeed because of their luck. When an opportunity is given to both a procrastinator and a doer, The probability of a doer seizing the opportunity is far greater than that of a procrastinator. So keep focusing on work over talk.
Caution over regret
It is great to take risks, but not at the expense of everything. Learn all your strengths and weaknesses, such as passive income sources, debts, and income statements, before you make an investment. It's better to be cautious than to regret making a decision. To be precise, taking unwanted risks is a bane to financial freedom.
Put your money to work
Your income, no matter how small, will not last forever. Your money needs to reproduce itself. It can be anything from business to stocks to properties. The power a passive income source holds will allow you to invest in yourself for betterment. Besides, once the cycle sets in, you will be out of the rat race of chasing financial security.
Learn from others
Our behaviour is highly influenced by our surroundings. So association with financially wise individuals helps us learn from them. Also, advice from them can guide your investments towards profits. Besides, avoid taking advice from financial misfits with no proven record of success.
Invest in yourself
It becomes necessary to invest in yourself, as your learning will reflect in your earnings. Also, if earning money is one aspect of building wealth, the other part is knowing how to put it to use. And in the worst cases, we see people lose everything due to a lack of handling skills. So, the last skill that completes the puzzle is learning to protect everything you build with time.
'The Richest Man in Babylon' is a series of parables set in the Babylonian era, the richest of ancient civilizations. The book emphasises the relationship between the men and the wealth of the past that made them build it over time. Countless financial secrets, such as the ten per cent saving rule and right investments, hold true to the present world struggles.
Written By: Sameena
Edited By: Chirajita Gupta