Book Summary of The Richest Man in Babylon

The Richest Man in Babylon is a simple book that teaches the reader the set of timeless principles necessary to become rich. It’s basically an account of ‘best practices’ to personal finance, told in an adventurous manner by following two men’s journey towards riches.

The Tale of a Man Who Desired Much Gold
In ancient Babylon lives the discouraged chariot builder, Bansir. He’s discouraged because he’s been working hard for years building chariots for the rich, but yet his own purse is empty. Bansir too desires nice clothing, exotic foods and other luxuries reserved for the upper class. He voices his concerns to his friend, Kobbi. Kobbi too is sick of being a poor man in a city with such splendid wealth as Babylon.

The two gentlemen decide to seek the advice of Babylon’s richest man, Arkad.

Arkad’s Advice
Arkad was a generous man, especially when it came to giving advice to his two old friends. He eagerly tells them the first lesson: Part of all I earn is mine to keep. He tells Bansir and Kobbi that no matter what, you will put aside one tenth of your earnings – no matter how much or little you earned. “Wealth”, Arkad explained, “like a tree grows from a tiny seed. The first copper you save is the seed from which your tree of wealth shall grow. […] The more faithfully you nourish and water that tree with consistent savings, the sooner may you bask in contentment beneath its shade.”

Arkad gave his friends a few other tidbits of advice.

He taught them that seeking his and other wealthy people’s advice was a tremendous idea, but be cautious of whom you ask! “Advice is one thing that is freely given away, but watch that you take only what is worth having.“

From Arkad, the friends too learned the importance of making gold work for you. Put your gold to work; allocate your savings into endeavors that may produce more gold for you.

Finally, Arkad informs Bansir and Kobbi that wealth creation is hard work: “Wealth grows wherever men exert energy.” The two companions need to be courageous and ready to take action in order to become rich, as “opportunity is a proud goddess who wastes no time with those who are unprepared.”

Seven Remedies for a Lean Purse
Are you prepared to spend less than you earn? Are you willing to put your savings to work? Are you courageous? Are you energetic? If yes, you – like Bansir – is ready to learn and employ the principles to getting rich: the seven remedies for a lean purse.

• Principle 1 – Begin fattening your purse: Put aside at least a tenth of all you earn, and save those coins or employ them into gold-producing endeavors – never spend from your savings.
• Principle 2 – Control your expenditures: The more you save, the more you can put aside or into investments. Keep your expenditures low, and put the savings into your savings.
• Principle 3 – Make your gold multiply: “A man’s wealth is not in the coins he carries in his purse; it is in the income he builds, the golden stream that continually flows into his purse and keeps it bulging.”
• Principle 4 – Guard your treasures from loss: Putting your savings into risky investments that turn sour is a road to great discouragement. The wise would advise: “The penalty of risk is probable loss. Study each case carefully before parting with your treasure, so that it may be safely reclaimed.”
• Principle 5 – Make your home a profitable investment: Own your own home and dutifully pay off your debts.
• Principle 6 – Ensure a future income: Engage in investments that may continuously ‘fatten your purse’; endeavors that promises a never-ending income stream.
• Principle 7 – Increase your ability to earn: Learn, forge relationships, and be on a consistent look-out for the next opportunity to expand your financial empire.

Now you know the ancient system to wealth creation. It’s up to Bansir, Kibbo – and us – to start living by these principles in order to become as rich as Arkad.