The Richest Man in Babylon by George S. Clason – Book Review

The Richest Man in Babylon is almost a century old. Yet, every doctrine it professes stays relevant even in the information age. Every lesson is helpful, and every doctrine indispensable. Babylon may have withered away, but its principles live on. George Samuel Clason’s masterpiece is a work of art, science, and commerce, which every individual must experience, master, and practice before earning their first buck. 

The Richest Man in Babylon

In the beginning, Clason introduces Bansir, a skilled chariot builder, and Kobbi, a talented musician. Both of them are skilled in their professions but find themselves struggling financially. They seek advice from Arkad, the richest man in Babylon, who reveals the Babylonian secret to wealth: “saving a portion of earnings.” Arkad emphasizes that a part of all a man earns is his to keep and explains the principle of paying oneself first. The secret might sound ridiculously simple at first, but the author substantiates it throughout the book. 

The Richest Man in Babylon is a financial guide in the form of parables set in ancient Babylon. The book presents timeless principles of money management and wealth-building, using engaging narratives to impart valuable lessons on financial success. The book is divided into 11 chapters, each written so beautifully that The Richest Man in Babylon could easily pass as a literary classic. Here’s a crux of the entire book.

Further in the book, we see Arkad narrating his life story and how he went from being a poor scribe to the wealthiest man in Babylon. He reveals his journey to accumulating wealth by following simple yet powerful financial principles. The first principle that Arkad shares is that a man must save at least a tenth of his earnings, regardless of how little or great he earns. Other principles Arkad shares include not spending more than the remaining nine-tenths, avoiding unnecessary expenses, and investing with caution.

Key Lessons from The Richest Man in Babylon

Arkad uses a metaphor to describe poverty – a lean purse. Obeying the King’s command, Arkad starts teaching the seven cures for a lean purse in the legendary Temple of Learning. Simply put, the richest man in Babylon starts teaching the poor how to become wealthy. In total, Arkad teaches his pupils Seven Cures for a Lean Purse and the Five Laws of Gold.  

At the onset, the lessons seem too simple. But as the lectures progress, we discover timeless wisdom in Arkad’s words, who makes a compelling argument for traditional financial management. Here are four key lessons from these lectures to help individuals attain financial success. 

Accumulate Wealth by Saving and Minimizing Expenses

According to The Richest Man in Babylon, financial success begins with accumulating enough wealth for investment. To attain wealth, Arkad advocates his two basic principles – save from your income and minimize your expenses. Combining these two principles will give you enough wealth to start your own enterprise or invest in appropriate businesses. 

Precisely speaking, a person must save at least 10 percent of his income, however slight it may be. Secondly, a person must analyze his expenses and drastically cut down unnecessary spending. If a person adheres to these two principles for an extended period, he will have enough money to explore various income sources. Read our review of The Power of Habit to learn how you can develop the habit of saving and avoiding impulsive spending.

Invest Your Savings Wisely – Right Persons, Great Advice, Minimum Risk

After you’ve accumulated enough wealth by following the principles of saving and mindful spending, the next step is to invest. Arkad says, “Make your gold and its children work for you.” He says that accumulated gold or wealth, if sitting idly, cannot help the owner achieve greater things in life or fulfill one’s reasonable desires entirely. However, while investing, one must be sufficiently cautious. Hunting for unreasonable returns can lead to unbearable losses, as they entail huge risks and unchartered territories. 

One of the most important anecdotes related to investing in the book is about Arkad himself. When Arkad was a scribe, he started saving on the advice of an old merchant. But when he saved enough gold for investment, he made a big blunder, so all his savings vanished. He trusted a bricklayer to trade in precious jewels and lost whatever gold he had. Thus, the story teaches us that we must never bet on a person who has not enough experience or knowledge of the enterprise he undertakes. 

Similarly, The Richest Man in Babylon heavily emphasizes seeking advice from learned, wise, and successful men. The book advocates saving time by asking men of experience about life and enterprise, which helps prevent mistakes and losses. Thus, by being cautious, seeking advice, and investing in the right person and business, one will amass substantial wealth.

Secure Your Future – Income and Dwelling

Among all of Arkad’s discourses at the Temple of Learning, arguably, the most important one is about securing the future. A person must secure the future of himself and his family, i.e., plan for his family’s well-being and post-retirement life. And how does one do that? By ensuring a future income and owning a dwelling. 

To ensure a stable retirement life, one has to set aside a small portion of his income and allocate it to future earnings. Arkad mentions two methods explicitly. First, purchase land or property which steadily grows in value and could be of significance when you retire. Second, lend your income to a profitable business that would pay you back after a pre-decided duration with added profits or rental. 

The other part of securing one’s future is to own your dwelling. Having a piece of land or a house helps bring peace and a sense of security to yourself and your family. Paying rent, according to the book, only fattens the landlord’s purse and leaves you at his mercy. While paying rent doesn’t seem too much you’re still earning, it could be too much when you retire. Thus, you’d be forced to leave the dwelling you and your family had cherished for years.  

Improve Earning Ability – True Desire, Skills, and Knowledge

The greatest asset of the human mind is the ability to progress in whichever respect one wishes. To achieve financial success, one needs to progress in terms of earning ability. Improving the ability to earn is the biggest contributing factor to earning more and generating substantial wealth. But how does one improve one’s earn-ability? 

According to The Richest Man in Babylon, a person can improve his ability to earn by three elements – having the true desire to succeed, attaining knowledge, and learning new skills. The true desire to succeed accompanies commitment and perseverance, without which success remains but a dream. Arkad says what we consider desires generally are nothing more than longings that never manifest into reality. Also, our desires mustn’t be so unrealistic that they bring nothing but disappointment. 

Those with true desires to work consistently to acquire greater skills and knowledge. You may be an employee or an entrepreneur; improving your earning ability will serve you equally. If you’re an employee, your employer will benefit from your skills, subsequently raising your value in the organization. Likewise, if you’re an entrepreneur, learning skills and attaining knowledge will help you lower costs, find new opportunities, and increase revenue. 

What I Liked About The Richest Man in Babylon

The Ornate Language

The Richest Man in Babylon is a finance student’s best lesson. But for a literary enthusiast like myself, I absolutely loved the writing. The use of medieval, Shakespearean language makes the book sound poetic, adding to its already massive appeal to a wider audience. While some might find it a bit confusing initially, I’m sure most readers will enjoy it thoroughly. Beginners looking for financial education, even those from vernacular backgrounds, will find the book friendly and interesting until the end. 

The Captivating Narration

While the language is ornate, the book’s narration is even better. Clason uses stories and anecdotes to deliver complex financial lessons, making it easier for beginners to understand. Plus, the whole Babylonian backdrop of the book adds charm and flair, sucking the reader in from the first word. As I progressed through the book, I witnessed a great and financially sound civilization which forced me to read more about the Babylonians later. 

The Believable Characters

This is my favourite aspect of The Richest Man in Babylon from a literary purview. Every character Clason uses to convey his message is believable and comes across as familiar. I could relate to the disciples of Arkad and felt as if he was a real teacher to me. The money lender, the old merchant, the bricklayers, Arkad’s son, and Sharru Nada, the merchant prince – every single one of them is as believable as day and night. 

The Utter Simplicity

While I loved the literary aspects more, the biggest strength of the book is its simplicity. Every message it relays and every lesson it teaches is simple on its face, but as we progress, the meaning becomes deeper and wiser. The utter simplicity is what makes the book stand the test of time and remain relevant even after nearly a century. In fact, The Richest Man in Babylon will retain its relevance even a hundred years from now. 

Final Thoughts

The Richest Man in Babylon is a remarkable book that can help 99 percent of individuals who live their life working nine-to-five jobs. Even the one percent who chose to become employers instead will also find it helpful in many ways. The book is a timeless classic, with messages so strong that it could change lives across the globe. Yet, the book is so simple that even a slum-dweller who knows to read can use the book as his financial guide. That’s the true beauty, the true mission of Arkad, the richest man in Babylon.