Book Summary – The Richest Man in Babylon – The Ancients’ Success Secrets – By George Clason

Strategies come and go, but principles are timeless. Don’t create new principles. Either you follow them or you don’t. This time around, the proven wealth principles are over 6,000 years old. I enjoy reading business and financial books, but I understand that most of you would rather go to the dentist and have your teeth removed. If you fit into that project, do me a favor and read just one financial book: The Richest Man in Babylon. Dave Ramsey, the financial personality you may have seen on television, makes a living preaching the principles outlined in this booklet. Again, do yourself a favor and read it. You will not regret having done it.

Why is this important to me? Let’s answer this with a few more questions. Are you financially secure today? Are you stressed about money and the future? Do you run out of money before you run out of month? If any of these questions seem true to you, or better yet, you are on the road to financial security and want to reinforce what you are doing, then this book is a must read and will help you. Why money? The love of money is a bad thing and I am not preaching it here. Money is a tool to help you acquire things that can aid in safety, happiness, and fun, as well as to help you build and tithe. Money is the means by which initial success is measured. Money makes it possible to enjoy the best that the earth has to offer. Money is plentiful for those who understand the simple laws that govern its acquisition. (Note: SIMPLE – that’s true !!!!!) Money is governed today by the same laws that controlled it when prosperous men filled the streets of Babylon, six thousand years ago.

These are the simple rules for acquiring money:

1. Start the purse to get fat

2. Control your expenses

3. make your gold multiply

4. Guard your treasures from loss

5. make your home a profitable investment

6. Secure a future income

7. Increase your ability to win

-The richest man in Babylon

The cool thing about these 7 laws is that you can use them for more than money. That’s another topic for another review ……….. Let’s dive into more detail and bring Old English to its current meaning.

This book is a short book that is packed with powerful principles. This summary may be a bit longer than others just because these principles need to be shared as soon as possible. If you observe financial collapse around the world, you must be educated and protect your future with sound principles.

1. A portion of everything you earn is yours. It should not be less than one-tenth, no matter how little you earn. Simply put, pay yourself first. This LAW creates great habits. If your bills last longer than your money after paying yourself, then that leads to the second basic principle.

2. For every ten coins I put in, spend only nine. This is such an easy principle but for some reason 90% of the population cannot follow it. You only need to spend what you have after paying yourself first. You pay yourself first to make the compounding LAW work for you and only spend the other 9/10. This does not mean charging your credit card and buying junk because you HAVE TO HAVE IT NOW. We are not 2 years old and we must stop acting like one. (I have been guilty of this and I understand that discipline is needed, but your loved ones deserve no less …)

3. Put each coin to work so that it can reproduce its species like the herds of the field and help you bring you income, a stream of wealth that will constantly flow to your purse. Okay, just talk encrypted. Basically what this means is that your money should work HARDER than you do. This principle eludes many people and you need to think it through. People thought they were rich before the housing collapse in 2008. This is not uncommon because their “NET VALUE” was high. EQUITY means nothing without the monthly money flowing into your pocket. Understand cash flow and make it a critical goal so your money works harder than you do.

4. Store your treasures by investing only where your capital is safe, where it can be claimed if you wish, and where you will not fail to collect fair rent. Unfortunately, I can write encyclopedia material with my mistakes in this area. This LAW is simply Warren Buffett’s RULE # 1 and it is: don’t lose money. You need to protect your main amount of money from mistreatment, shady people, and swimming with sharks. If you’re intrigued by the next big investment, do me a favor, go golfing and forget about it. I’ve endured enough butt teasing and want to protect you from having to go through the pain. This is where financial education comes in. The only safe investment for true growth is in yourself and the things you understand.

5. Own your home – This one is self explanatory and comes with some controversy. I think your house is a liability because it does not have cash flow. This doesn’t mean you shouldn’t have it. Right now is the best time to buy homes because the housing bubble has ended and prices are very depressed. Home ownership has some rewards and provides security.

6. Provide in advance the needs of your growing age and the protection of your family. It’s basically about savings on steroids. Now that you have some savings and you know that your money should work harder than you, you can use this principle to solidify it and be DISCIPLINED in your execution. Keep saving for cash flow investment opportunities.

7. Increase your ability to win – Cultivate your own powers, to study and become wiser, to become more skilled, to act in a way that respects yourself. IMHO, this should be number 1. The best investment you can make is in your own gray matter. You need to keep learning and educating yourself. A self-taught financial education will teach you the power to save for cash flow investments, protect yourself from shady businesses, people and circumstances, and harness the power of compounding.

The Richest Man in Babylon should be a reading and study requirement for everyone. This book describes everything you need to be successful when it comes to money. Buy this book and share it with those closest to you.

I must admit that I am fortunate because I grew up with these principles embedded in my hard head. Unfortunately, most people are not so lucky. This book will help you.

I hope this short summary has been helpful to you. The key to any new idea is to incorporate it into your daily routine until it becomes a habit. Habits are formed in just 21 days.

One thing you can take out of this book today is schedule 15 minutes every day and study something of financial value. It can be a video, a blog, an article or a book, but use your time wisely. Your loved ones deserve nothing less.