7 Lessons I learnt from “The Richest Man In Babylon”
After some months or years of reading a book when you try to remember what you have read in the book, you will notice that you remember very less things about that book. Seeing this, I have decided to write a summary/lessons I have learnt from the Richest Man In Babylon. So that I can recollect my observations and things I have learnt from this book.
Babylon was the wealthiest city of its time. Their people were the smartest of their time. Historians say that they were the first to have engineers, astronomers, mathematicians, financiers, etc. But now you will find only the remains of the city buried under the desert near the Euphrates river.
Let’s start with the lessons that I have learnt from the book:
Lesson 1: Save at least 10% of your income
You will see 10% is a very less amount. What will happen with that 10%? Many will argue, try to save a minimum of 30–40%. But the point here is not everyone is capable of saving 30–40% from their income. So anyone can start saving at least 10% of their income. Start with 10 and go on increasing as much as you can. But you need to save a minimum of 10% anyhow.
Lesson 2: Invest your money
Don’t just let your money sit idle in the bank. Because if you are going on saving in the bank, and you are not generating money from the money which you have saved, then you are losing the value of that money with each passing day because of inflation. Some will say that bank will pay you interest but seeing the inflation rate, the amount which the bank gives us is very less. We cannot buy the same amount of things now from the money which we used to buy some years ago because of inflation. So instead of always keeping in the bank we can invest our money and let our money generate more money for us. This way we can compound our wealth.
Lesson 3: Protect your money
The money you have earned is yours. Don’t spend it on unnecessary things. Don’t take investment advice from the wrong person like don’t ask a Carpenter about Stocks. Invest only where your money is safe and you can take it out anytime.
Lesson 4: Don’t live without enough protection
The future is unpredictable. We don’t know what can happen in future. A smart person is one who plans for unforeseen circumstances in advance.
If you are the sole earning member and your family is dependent upon you, and anything happens to you then what? Now we can prevent these things by buying Medical insurance to cover our medical bills, buying Term insurance to get financial security for our family when we are not around.
Lesson 5: Keep learning
Keep learning & polishing your skills continuously over time. Remember once you stopped learning, others can beat you easily. The common difference between a Rich and a Poor is, Rich, reads books while the poor spend their time playing, watching, gossiping, etc. (Even I am poor, but mentally I am rich. My current situation doesn’t define my future self. I am working on my dreams and I am sure one day I will achieve them.)
Lesson 6: Where the determination is, the way can be found.
No matter what the situation is? If you have a winning mentality like I will not give up, I will come out of any situation, then you will always find a way to tackle your problem. Your attitude towards the problem determines whether you are going to come out of it or sink in it. It’s you who needs to take this call and bring out the smarter version of you in every problem.
Lesson 7: Work is your best friend
Never run from work. Make it your best friend because of it you are going to earn the wealth you desire. It can lead you out of poverty. It can lead you out of your debt. Work doesn’t mean doing a job in some company, because from a monthly income you can’t build a fortune unless you are Pichai or Nadella. It can be anything like working for someone, working on your own idea, doctor, contractor, artist, etc.
If you don’t agree on any points then feel free to comment and express your views.
