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The Richest Man In Babylon is one of the most classic books ever written on business, investing and wealth creation.
Written in the 1920’s it has stood the test of time for business advice. The video outlines 5 of the most important take away point from the book that you can apply to your life right now to grow your wealth and improve your finances.
1. Pay yourself first (at least 10%)
2. Recycle profits into new investments
3. Invest only with those who’re experienced
4. Avoid overly risky investments
5. Create multiple streams of passive income
“Seven Cures for a Lean Purse
Sargon of Akkad, the King of Babylon, is told by his Royal Chancellor that the kingdom is poor. There are not enough jobs for everyone, people don’t have enough money to buy what they want to buy, and farmers can’t make enough selling their produce to continue farming. All of the gold has found its way into the possession of a few very rich men of Babylon. The King asks why so few men would be able to acquire all of the gold and the Chancellor says because they know how to, that one may not condemn a man for succeeding because he knows how, neither may one with justice take away from a man what he has fairly earned, to give to men of less ability. But why, the King demands to know, should not all the people learn how to accumulate gold and therefore become themselves rich and prosperous? After further consultation with the Chancellor, the King summons Arkad to teach people how to become wealthy. Arkad then delivers a series of lectures to a class of one hundred men, teaching them the seven cures for a lean purse.
Start thy purse to fattening
Arkad instructs the men to begin by continuing to work hard at their current occupations, but for every ten coins placed in their purse to take out for use but nine. Their purses will start to fatten at once and their increasing weight will feel good in their hands and bring satisfaction to their souls. “Deride not what I say because of its simplicity,” Arkad says, “Truth is always simple.”
Control thy expenditures
“How,” some of the men ask, “Can a man keep one-tenth of all he earns in his purse when all the coins he earns are not enough for his necessary expenditures?” “How many of you have lean purses,” Arkad asks. All of the men say that they have lean purses, that they have no money. “Yet,” Arkad responds, “Thou do not all earn the same. Some earn much more than others. Some have much larger families to support. Yet, all purses are equally lean. Now I will tell them an unusual truth about men and the sons of men. It is this: That what each of us calls our necessary expenses’ will always grow to equal our incomes unless we protest to the contrary.” Arkad tells the men not to confuse necessary expenses with their desires, that all men are burdened with more desires than they can gratify. “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.”
Make thy gold multiply
This simply explained that, once you’ve started saving at least one-tenth of what you earn, you must put that money to work earning interest. “Put each coin to laboring that it may reproduce its kind even as the flocks of the field and help bring to the income, a stream of wealth that shall flow constantly into thy purse.”