Introduction
If you are looking for a fun way to help your child (or yourself) learn about personal finance, “The Richest Man in Babylon” is a must read. Originally published in 1926, it has stood the test of time and is still one of the most influential books around.
It’s set in Ancient Babylon and follows a group of characters on their journey as they learn valuable lessons about building wealth and financial freedom. The book shares timeless wisdom on topics such saving money, investing money, budgeting and managing debt.
The book conveys complex financial concepts in a simple and entertaining way. Although some of the language is a little tricky it is a book I recommend to both children and adults.
Remember, as the book teaches us, “a part of all you earn is yours to keep.” So why not invest in yourself and pick up a copy of The Richest Man in Babylon today.
I wish I had discovered this book twenty years ago and learnt about the importance of personal finance. It is a crucial skill that is currently not taught in schools. This book makes it interesting, engaging and entertaining.
Here, we highlight the 10 best quotes from the book, give our interpretation of the quote and sometimes show you how to apply this knowledge in the real world. We hope this makes personal finance more accessible and interesting to children and adults.
We have also created a Book Summary for The Richest Man in Babylon.
We believe learning about personal finance is crucial at a young age to build a strong financial foundation. Learning about saving, budgeting and investing can set you up for a lifetime of financial success.
The book offers a fun and engaging way to learn about money and building wealth. We will use quotes from the book to hopefully spark some interest on the subject and make understanding these concepts more memorable.
We’ll be applying these quotes to real life situations, showing you how to put these lessons into practice. The article will offer practical advice, this could be opening a savings account, investing in the market or simply avoiding debt.
So if you're ready to learn more about how The Richest Man in Babylon can help you with personal finance, please keep reading!
Top 10 Quotes from The Richest Man in Babylon Book
Here are our favourite quotes from the book, our interpretation of them and how we can apply them to real life.
"A part of all you earn is yours to keep. It should be not less than a tenth no matter how little you earn."
No matter how much or little you earn you should set aside at least 10% of the income for yourself. Pay yourself first before paying other people and bills. It may not be much to begin with but it will soon add up. In real life you can set aside 10% of the money you earn to be directed to a different bank account, this way you don’t need to think about it, it happens automatically.
"Advice is one thing that is freely given away, but watch that you take only what is worth having."
Everyone gives out advice but not all of it is valuable or helpful. Exercise caution when taking advice , blindly following advice can lead to poor decision making and negative outcomes. Evaluate any advice given to you before using it and ignore the rest.
In real life we should only seek advice from credible and trustworthy sources. Do not take financial advice from your electrician about the stock market. Do take advice on the wiring in your home from the electrician.
"Men of action are favoured by the Goddess of Good Luck."
Be proactive and seize any opportunities coming your way. The Goddess of Good Luck represents the idea that those who take chances will be awarded with good luck. By being more proactive and taking action towards your goals, we can increase our chances of success and attract more positive outcomes.
In the real world we need to take calculated risks all the time, it is important that we evaluate the risk vs reward each time and do not blindly accept all risks.
"Opportunity is a haughty goddess who wastes no time with those who are unprepared."
Be ready to seize opportunities when they arise. The term “haughty goddess” suggests that opportunity is a powerful force that demands respect from those seeking to benefit from it. Opportunities come and go quickly, if you are unprepared, you are likely to miss them. Success requires hard work and preparedness and seizing opportunities when they arise can make all the difference in achieving your goals.
"Work attracts good luck, idleness attracts bad luck."
Our behaviours and actions can influence our luck and success. Those who work hard and take actions towards their goals are likely to attract positive outcomes and those who are passive and idle are likely to attract negative outcomes.
It reminds me of the quote “The harder I work, the luckier I get” by Samuel Goldwyn and Gary Player.
You can set your own goals for success, remember to break down goals into smaller goals and slowly take action towards them. Success is often a result of hard work and dedication.
"Better a little caution than a great regret."
It is often better to be a little cautious and careful in our actions and decisions instead of regretting them later on. Think before making decisions and taking action, by being cautious we can avoid potential pitfalls and regrets. Take time and consider all your options first, then take action.
"The camel does not drink until he is first led to the water."
Sometimes we need guidance or direction to accomplish our goals, just like a camel needs to be led to water to drink it. It is important to seek out guidance and support when we need it, this could be a professional or just a friend. We may need someone to push us in the right direction. By taking advantage of the knowledge and advice of others we can learn and grow quicker than doing it alone. We can also avoid the mistakes they made along the way.
Seek out professionals to assist you in areas where you want to grow, this could be a Maths Tutor to help you improve in Maths.
"Wealth, like a tree, grows from a tiny seed."
Building wealth is a process that requires patience and perseverance, for a period of time it may look like its not doing anything. Just like a tree begins with a tiny seed, it spends time growing roots and then begins to grow slowly. Start small and be disciplined in saving and investing. Planting a small seed and nurturing it over time, your wealth can grow and flourish providing you with financial independence and freedom.
In real life you could set aside a small percentage of your income and invest it.
"Wealth that is earned quickly is often lost quickly."
When you suddenly accumulate a large amount of money quickly, you can lose it just as quickly with careless spending, risky investments and lack of financial planning. Wealth accumulated with careful planning and effort is likely to be more sustainable over time.
We should avoid taking unnecessary risks and resist the temptation to overspend.
"A man's wealth is not in the purse he carries. A fat purse quickly empties if there be no golden stream to refill it."
A person's true wealth is not determined by the amount of money they have to hand. True wealth comes from having a steady income (golden stream) that continuously refills the purse. Even if someone has a lot of money right now, it will quickly disappear if there is no income to replenish it. To create your own golden stream, invest in your education, your career, and create passive income sources such as businesses and property rental.
"The borrower is servant to the lender."
The borrower is in a position where they owe something to the lender which they must repay with interest. This can affect their financial freedom and decision making. The borrower is the servant to the lender until the loan is repaid. Borrowing money should be done carefully and thoughtfully with a solid plan for repayment and an understanding of consequences of failing to do so.
In real life if you are planning to save money, first you should pay off any loans you may have first. This is because usually any loans you have will charge more interest than what you will receive from making an investment. The only exclusion to this rule is usually a mortgage.
Conclusion
In conclusion The Richest Man in Babylon is a must read book and offers valuable lessons on personal finance and conveys them in a simple and entertaining way making it accessible to both children and adults. We explain the top 10 quotes from this book and provide practical advice on how you can apply this in real life. For the vigilant among you, there were actually 11 quotes, but that doesn't quite have the same ring to it as 10 quotes!
So why not invest in yourself and pick up a copy of The Richest Man in Babylon, it could be your foundation to a lifetime of financial success!
