Book Review

The Richest Man in Babylon

The Success Secrets of the Ancients

Author

George S. Clason

Genre

Personal Finance

First Published

1926

Copies Sold

Over 2 million

Overview

A personal finance book that shares its wisdom through a story set 4,000 years ago in ancient Babylon, about a fictional character called Arkad, a poor scribe who became the richest man in Babylon.

Through entertaining tales of merchants, tradesmen and herdsmen, Arkad's advice includes the “Seven Cures” (how to generate money and wealth) and the “Five Laws of Gold” (how to protect and invest wealth).

The result is an engaging story that educates the reader on the secrets for creating, growing and preserving wealth.

Major Lessons

Pay Yourself First

Save at least 10% of your income before spending on anything else. This principle is articulated in the saying, "a part of all you earn is yours to keep."

Live Below Your Means

The emphasis is on frugality and living within one's means. By controlling expenses and avoiding unnecessary luxuries, one can accumulate wealth over time.

Make Your Money Work for You

The book encourages readers to invest their savings wisely to generate passive income, effectively making their money work for them to create more wealth.

Seek Wise Counsel

Consulting with knowledgeable and experienced individuals before making financial decisions is a recurring piece of advice, highlighting the value of learning from others' successes and mistakes.

Protect Your Wealth

The importance of safeguarding one's capital from loss is highlighted through the lessons on risk management and careful investment strategies.

Practical Advice

What to start doing today.

Create a budget for your income and expenses

Learn how to create a budget with the aim of fully understanding your income and expenses, and working out the amount of free cash you expect to have.

Pay yourself first

Create a second bank account and automate the transfer of your free cash on pay day, from your current account to your savings account.

Invest in your financial education

Pursue financial education through books and mentors around money psychology, budgeting, saving and the world of investing.

Put your money to work

However much you have, start investing your money today. The less experienced you are, take less risk, and adapt over time.

Summary

"The Richest Man in Babylon" is a timeless guide to personal finance that's as useful today as it was nearly a century ago.

It shares simple but powerful lessons through stories set in ancient Babylon, making the basics of money management easy to grasp. Whether you're just starting out with your finances or need a reminder of good money habits, this book gives you practical tips in a fun and straightforward way.

If you're looking for essential financial advice wrapped in entertaining stories, "The Richest Man in Babylon" is a must-read.

Power Passage

‘Every fool must learn,’ he growled, ‘but why trust the knowledge of a brick maker about jewels?

Would you go to the bread maker to inquire about the stars? No, by my tunic, you would go to the astrologer, if you had power to think. Your savings are gone, youth; you have jerked your wealth-tree up by the roots. But plant another. Try again. And next time if you would have advice about jewels, go to the jewel merchant. If you would know the truth about sheep, go to the herdsman.

Advice is one thing that is freely given away, but watch that you take only what is worth having. He who takes advice about his savings from one who is inexperienced in such matters, shall pay with his savings for proving the falsity of their opinions.’