'The Richest Man in Babylon' is still one of the best selling books worldwide. I say 'still' because it was first published in 1926. When you search Google for best books on financial success, the first result will be this article by Inc.com, customized into a list. However, this list of 7 books by Success Magazine (rather by Jim Rohn) was the one which inspired me to read this amazing book.
PS: The two articles linked above are a rich resource for readers interested in finance and success. I'll be glad if you find them useful.
The book was originally a separate series of parables distributed by banks and insurance companies as financial advice. The author George Samuel Clason used ancient Babylon to dispel his words of wisdom. The parables were combined in 1926 in form a book named after its most famous chapter; The Richest Man in Babylon. The book has since 1920's been inspiring investors till this date. While it continues to spread financial wisdom, which I am lucky to have received, I thought of sharing this wisdom with you in a simplified way.
The series of stories below is based on The Richest Man in Babylon and contain the fundamental secrets to becoming wealthy. Despite all their simplicity, they are powerful principles difficult to master because they demand a change of attitude and mindset in order to set you on a path to financial success.
Read on to unlock the financial genius in you.
Difficulties and Desires of Bansir & Kobbi
Babylon was home to one of the richest and most thriving civilizations. Travelers used to say that there was none other like Babylon. Yet, there were people who were poor. Even worse, there were slaves who used to bring water for the famous hanging gardens of Babylon.
Bansir was a resident of Babylon who used to make chariots for the rich. He was one of the finest chariot maker in the city. Despite that, he was worried about his financial situation as he would often find himself restricted in spending.One day, Bansir was sitting on a wall; thinking about his situation. His friend Kobbi arrived at the scene. Kobbi was a good musician. Bansir and Kobbi were best friends for a long time.
Kobbi had come to Bansir to ask for a small loan that he needed. He was taken aback by Bansir's response, though. Bansir informed him that he did not have enough money to spare even for his best friend. Kobbi became worried as well. First of all, he started asking Bansir to work instead of sitting idle on the wall. Bansir did not move. Then a discussion started.
Bansir was of the view that they lived in the richest environment and yet they were poor. Kobbi agreed. Both of them talked about how wealth separates men. Some become influential while others become slaves; despite working more and being finer men.They also noticed how their sons were going to remain poor as well by following their fathers' footsteps. A sense of genuine concern was running through these good friends now.
Kobbi pointed out that their efforts in making chariots and music had earned them recognition so it couldn't be said that their efforts were wasted. He suggested Bansir that, might be, making money was a complete art on its own. If that was true, they deserved to be poor because they had never tried to make money or learn how to make it.The discussion was reaching an important point now. Both of these struggling men had realized that they had to learn how to make money just like they learned to make chariots or music.As opposed to their situation, one of their friends, named Arkad, was the richest man in whole Babylon. Both of them decided to consult their friend and learn the secrets of earning more wealth; such that existing money may make more money.
Bansir doubted if his mind could learn and apply those principles. He started thinking that the secrets were a gift only Arkad could receive. Kobbi quickly disagreed. He sighted the example of Arkad's son, Nomasir, who went to another city called Neveh and became the richest man there; independent of his father's advice.
Bansir was so convinced that he insisted they went to Arkad right then. Kobbi agreed. Both of them lamented why they had never thought like that before. Bansir mentioned their other struggling friends who needed the advice too. Both of them agreed to take other friends with them to meet Arkad.
That's how Bansir, Kobbi and their friends started the journey to become the rich of Babylon; a civilization abundant but not feeding them well due to their lack of wisdom.
Meeting Arkad : The Richest Man in Babylon
Bansir and Kobbi took their friends with them to meet the richest man in Babylon. This man was Arkad; their childhood friend.
They told him how lucky he was to become so rich while they struggled for existence. They blatantly pointed out how once they were equal to him.There was all the proof to support their claim. Arkad and these friends were taught by the same teacher. He wasn't brilliant in games or studies. He was as much honorable citizen of Babylon as they were and he hadn't worked too hard either.
They questioned him why fate had been so kind to him while they received no favor. Arkad rejected their idea of fate being responsible for his success. For their failure to be wealthy, he blamed their lack of knowledge of the principles which govern the acquisition of great wealth. He blamed their inaction if they already knew the rules.
After their notions were rejected, they started inquiring him how only he could accumulate so much wealth if they all had the equal opportunity to do so. This twist in the discussion opened a way for Arkad to share his story of success; a story his friends had come to listen to. Here's what his friend learned about Arkad that day.
Arkad wanted good things in life. He did not want to live a live with no fulfillment. He knew that wealth was essential tool to get all the good things in life. He wanted to have great wealth so that he could fulfill his wishes.His master, and the master of his friends, had told them that there were two types of learning.
- The things we learn and know.
- The training which taught how to know the unknown.
He didn't know it but he wanted to find out how to be wealthy. The training of his master came to his rescue; a training everyone of his friends had also received.
Arkad got employed as a scribe and used to write records on clay platelets. It was a laborious task. He worked hard but even after months of hard work, he had nothing to show in his purse. All his earnings were spent on food, clothing and day to day expenses.But he was determined not to give up. A rich money lender, named Algamish, needed copy of a law scribed. He offered Arkad two coppers for completing the task in two days. However, Arkad couldn't complete the task.
When Algamish came to collect his order, he was disappointed not to see it completed. Arkad saw his arrival as an opportunity to learn from the rich man's experience. He offered Algamish that he'll pull an all nighter to complete his work but in returned, he will have to teach him how to get rich. The deal was made.
The next day, Algamish arrived and found his ordered work completed by Arkad. It was time to deliver on his promise. He started by explaining to Arkad how age was better than youth for advice, likening age to stars and youth to the bright light of meteors; former being long lasting.
He advised Arkad to start with keeping a part of all he earned. The affirmation he gave for this number one rule was:-
"A part of all I earn is mine to keep."
Arkad was mildly surprised and asked him if all he earned was already not his to keep. Algamish reminded him of all the expenses he had to incur. He asked him to show any earning he had left from the past month or year. Arkad quickly realized how he had been paying everyone else; as if he worked hard just to fill others' purses.
Algamish Shares Wealth Secrets with Arkad
Bansir, Kobbi and their friends were listening keenly to the story of Arkad. They were more interested than ever before because Arkad was on his way to explain his secrets to them. It mattered to them because Arkad was the richest man in Babylon.
In his youth, Arkad was just like his friends, who were attentively listening to him in the audience. He worked hard as a scribe but didn't have any wealth to show. Algamish, the rich money lender, had promised him to share the secrets of becoming wealthy, in return for the whole night's work that Arkad had done for him.
The guiding principle that Algamish taught was:-
"A part of all I earn in mine to keep."
He went on to specify for Arkad what portion needed to be kept. The least he specifically mentioned was one tenth of all earnings. No matter what Arkad earned, he had to keep one tenth of it. He could keep as much as he wanted, whatever the portion of his hard earned coins, but one tenth was the least he had to keep. By keeping, it meant that all the spending would be done from the remaining portion.
Algamish asked him what amount of wealth he will possess if he kept one tenth portion for ten years. He trusted his knowledge of numbers and told Algamish that he would possess as much as he could earn in one year.
Algamish wasn't impressed though. He told him that every coin you keep becomes your slave and works for you. It gives children in shape of more earnings. Those children give more children and the earnings keep increasing. So, the amount after ten years will be way more than the earning of one year.
Algamish left. Arkad thought about it over and over again but found it convincing and reasonable. Once he had understood the wisdom, he started following it. He started keeping one tenth of all he earned.
After one year, Algamish returned; just to inquire about Arkad's progress. He asked if his advice was followed. Arkad replied with confirmation that so was the case. Delighted by the response, Algamish asked him what he had done with his kept wealth.
Arkad told him that he had given his savings to a brick maker named Azmur, who had gone on a travel to a neighboring country where beautiful jewels were made. He would bring back jewelry bought using Arkad's savings. Upon his return, they were to sell that jewelry and share the profit.
Algamish became furious upon hearing this. He scolded Arkad for trusting a brick maker with his coins to buy jewelry. He advised him to take advice only from professional people; those who know their field well. Also, he informed him in advance that his investment had been lost.
That's what happened a few weeks later when Azmur returned from his journey. He bought fake jewels made of ordinary glass which they couldn't sell.Repenting on his blunder, Arkad promised to himself never to repeat that mistake. With the new determination, he started keeping one tenth portion of his earning again. What really surprised him was the fact that despite spending less than he did before keeping a portion, he felt no change in the way he lived. He could keep a portion without changing much in his life.
Another year passed. The master returned to his student again to see his progress. Algamish had seen something in Arkad. That's why he returned again. When he arrived, he asked Arkad about his progress.
Arkad told his master that he had saved faithfully and lended his savings to a shield maker named Aggar. Aggar would buy bronze with that money, make shields and sell them. Each fourth month, Arkad would get a rental from Aggar; who was an honest man.
His master was happy with the progress. Next, he asked his student what he had done with the earning he was receiving in form of rental. Arkad replied that he would fulfill all his wishes of eating good food and other luxuries of life. His master laughed and told him that he was guilty of eating children of his savings. Then he left.
For two years, the master didn't return. One day, he showed up with serious signs of old age. He asked his student if he had achieved all the wealth he desired. Arkad didn't say he had got all he wanted but he did mention that he had some wealth now and his money earned more money and that profit was invested again make even more wealth.Upon hearing the answer, Algamish told him that he had learned his lessons well.
- He had learned to keep at least one tenth of all he earned; thus living on less than what he earned.
- He had learned to take advice only from competent people of their field.
- Lastly, he had learned how to make his money work for him.
After assuring him that the lessons were well learned, Algamish found Arkad to be the right person to share his worries with. He was an old man and was worried about something very important.
Babylonians Learn the Secrets of Great Wealth
It took four years before Arkad had truly experienced and absorbed the secrets of accumulating wealth that Algamish had shared with him. Algamish had come to enquire about his student's progress, which he found to be genuinely good.
Algamish, the rich money lender, was an old man now. His appearance was that of a man becoming weaker due to aging. As Arkad had shown promise of becoming rich and had learned the lessons well, Algamish shared one of his personal concerns with him.
He told Arkad that he had some great interest to take care off but could neither do it himself no trust his own sons, who would certainly destroy all the wealth due to their irresponsible handling the estate. He offered Arkad the chance to work on his lands in Nippur and if he agreed, he'd become Algamish's partner and share Algamish's wealth.
Arkad had been waiting for such an opportunity. He proceeded with Algamish and started looking after his property. He utilized all the energy of his youth to produce brilliant results from all the property. He had thoroughly impressed Algamish with his hard work and passion. As promised, Algamish shared his wealth with Arkad when he died. He had made sure that Arkad gets his share as per the law.
Arkad had finished telling his story of how he became rich. The moment he finished, one of the listeners highlighted how lucky he was to get picked by Algamish as partner. Arkad agreed that he was lucky but only in having the desire to become rich when he first met Algamish.
It wasn't until four years of learning that Algamish finally trusted him and made him a partner. Attributing his success with mere fortune sounded offensive to Arkad. When the claim of fortune being the only player was downplayed, another reason was suggested by one of the listeners.
That excuse was the will power. One man suggested that Arkad had achieved all his success because of his will power. He again became furious and asked whether goodwill could make a man lift a load that camel lifted.
Arkad explained to them that if he wanted to do something, he would do it no matter how mundane or boring it looked. If he promised himself to throw one pebble in the river every day, he would do it without thinking how useless the task is. So, the reason he became rich was that he wanted to become rich.One crucial question still remained. One of his friends did ask him that question finally. If everyone became rich by following his advice, won't all the wealth vanish and none left?
Arkad calmly answered this question as well. He told them that the gold spent by the king on building walls was not gone forever because a portion of it went to all the workers there. Those workers buy things for them and their good families. They pay with the same gold. Thus, the gold is always available to be taken by those who understand how to get it. The wealth increases magically and it will never vanish.
After being satisfied with the answers, one of his friends from the audience asked for advice to become rich. Arkad happily laid out for him and others the simple principles of becoming rich.
The first principle that he emphasized was keeping a part of all they earned. He advised them to keep a portion, not at all less than one tenth, of all their earnings. He advised them to repeat one thing again and again until it became their second nature. And that thing was:-
"A part of all I earn is mine to keep."
The second part of the advice suggested building an income for the future. The money saved through the first principle must be utilized, meaning invested, to create additional income. The income thus obtained should be reinvested. That's how people can make their money work for them.
The last but the most important point of his advice was to counsel with wise men. He urged them to seek advice only from the people who knew their trade and were successful at it.
His friends thanked him and left. Some of them didn't understand much. Some were cursing Arkad for not sharing a portion of his wealth with them. They thought that instead of helping his friends, Arkad was telling lame stories. But some of his friends had a new life that day. Bansir and Kobbi were certainly two of those men who truly appreciated the worth of wisdom that had come to them. They kept counseling with Arkad again and again.
Those were the men whose lives changed for good. They had found the secret to living a good life. The wisdom had come to Arkad from Algamish and now them from their richest friend.
Conclusion
The Richest Man in Babylon continues to provide sound financial advice till this date. It is one of those precious jewels which never lose their value. It certainly is the everlasting financial wisdom equally applicable in all the times no matter what the currency. Gold was the standard then, fiat is the currency now and cryptocurrency promises to be the future.
Regardless of how wealth and financial success is measured, the wisdom contained in the parables of The Richest Man in Babylon will never fail to inspire generations of investors. That is exactly why I cared to share this wisdom with you. If you care to share it further, I'll be grateful to you.
