“I like not idle gold, even less I like too much of risk”
I am dubious of media; whether it is print or broadcast media, that claim to give insights into ‘Becoming rich’ or ‘How to make money’. Often, I find the messages shared shrouded in secrecy; too vague for my taste, with words and phrases like ‘save’, ‘invest’, ‘manage your spending’, ‘diversify’ etc. thrown around. While I admit to being somewhat lazy when it comes to handling money, I can’t help but feel like a good amount of the information out there on making money is clouded by complexity (those overly technical books by American authors on ‘How to invest’), deliberate obscurity (I am yet to find a youtube video captioned similar to ‘How I make money on youtube’ that actually really breaks down making money on youtube) and over simplicity aka common sense advice – It’s like, ‘No shit Sherlock, I should really save some money huh?’
That being said, I will get off my high horse and hopefully dispel any notions of naïveté you might think I possess. I have come across shocking statistics concerning the public’s attitude to wealth; with thousands of Britons declaring bankruptcy due to systematically living beyond their means. Perhaps, common sense advice such as ‘save for a rainy day’ or ‘live beneath your means’ is gold for some. This is not to whittle down more complex situations to the lack of common sense or mock the wisdom of others. On the contrary, I am of the opinion that savings and investments are a luxury for some and a believer of the saying; ‘Our acts can be no wiser than our thoughts. Our thinking can be no wiser than our understanding’. I was merely pointing out the need for even the most basic of ideas.
I had previously come across the book by George Clason titled: The Richest Man in Babylon, but had delayed reading it for reasons my preamble hopefully explains. Clason provides tips for wealth creation, through factitious and fictional stories from ancient Babylon. Recently, I have been binging on Game of Thrones and decided to do something beneficial, to convince myself I wasn’t getting brain damage from too much TV. So, I finally read the book. Wait. By the way, do you watch or read Game of Thrones? If you do, ‘you smart’ and if you don’t…I have nothing to say to you, please keep on reading.
The Richest Man in Babylon left me with mixed feelings where on one hand, the teachings were too simple for my taste and on the other, the tales from ancient Babylon charmed and amused the story lover in me. Whilst I’m not crazy about this book, I do think it could be insightful for some and would recommend checking it out if you’re just starting out with managing personal finances, you appreciate a good tale or looking for a quick read with insights on personal finance.
I could do a ‘lessons learned’ type post on this book but that would be further simplifying an already simple book. So I’ve opted to share what pieces were the most insightful for me, with the aim of capturing the essence of the message delivered by the book. It is my hope that these short paragraphs and quotes, in their simplicity, triggers deep thought around finance management and wealth creation.
Here they are :
On men and sons of men
Now I will tell thee an unusual truth about men and sons of men. It is this; That what each of us calls our ‘necessary expenses’ will always grow to equal our incomes unless we protest to the contrary.
“If you desire to help thy friend, do so in a way that will not bring thy friend’s burdens upon thyself.”
“The purpose of a budget is to help thy purse to fatten. It is to assist thee to have thy necessities and, insofar as attainable, thy other desires. It is to enable thee to realise thy most cherished desires by defending them from thy casual wishes.
On the Goddess of luck
Herein lies a truth that many similar tales of good luck, won or lost, could not change. The truth is this: Good luck can be enticed by accepting opportunity.
I learned that to attract good luck to oneself, it is necessary to take advantage of opportunities.
“Those eager to grasp opportunities for their betterment, do attract the interest of the good goddess. She is ever anxious to aid those who please her. Men of action please her best”.
Free men and slaves
We found water. We passed into a more fertile country where were grass and fruit. We found the trail to Babylon because the soul of a free man looks at life as a series of problems to be solved and solves them, while the soul of a slave whines, ‘What can I do who am but a slave?’.
Cures for a lean purse
“This, then, is the sixth cure for a lean purse. Provide in advance for the needs of thy growing age and the protection of thy family.”
“Thus the seventh and last remedy for a lean purse is to cultivate thy own powers, to study and become wiser, to become more skillful, to so act as to respect thyself. Thereby shalt thou acquire confidence in thy self to achieve thy carefully considered desires”.
This subtle take on S.M.A.R.T goals
“Preceding accomplishment must be desire. Thy desires must be strong and definite. General desires are but weak longings. For a man to wish to be rich is of little purpose. For a man to desire five pieces of gold is a tangible desire which he can press to fulfillment. After he has backed his desire for five pieces of gold with strength of purpose to secure it, next he can find similar ways to obtain ten pieces and then twenty pieces and later a thousand pieces and, behold, he has become wealthy. In learning to secure his one definite small desire, he hath trained himself to secure a larger one. This is the process by which wealth is accumulated: first in small sums, then in larger ones as a man learns and becomes more capable”.
“Desires must be simple and definite. They defeat their own purpose should they be too many, too confusing, or beyond a man’s training to accomplish”.
And this special unexpected piece
That man who keepeth in his purse both gold and silver that he need not spend is good to his family and loyal to his king.
The man who hath but a few coppers in his purse is indifferent to his family and indifferent to his king.
But the man who hath naught in his purse is unkind to his family and is disloyal to his king, for his own heart is bitter.
Therefore, the man who wisheth to achieve must have coin that he may keep to jingle in his purse, that he have in his heart love for his family and loyalty to his king.
If you know of any useful resources, books etc. that provide an insight into wealth creation (particularly around investments), I’d love to hear from you. Please leave a comment below or drop me a note. Personally, investing is an area I haven’t quite cracked yet with regards to personal finance and I believe it is important for young people to have a good knowledge of it because we are more susceptible to poor finance management habits and early knowledge of investment is beneficial for better longterm returns.
Photo: Gratisography and Penguin Random House