Your Blueprint for Financial Freedom: Unlocking the Time-Tested Formula for Wealth Creation from the Richest Man in Babylon

The Richest Man in Babylon is about the story of Bansir, a chariot builder, and his quest for wealth. Bansir’s personal story helps introduce the idea that anyone can acquire wealth if they learn and apply the right principles. You just have to be disciplined.

Bansir speaks with Arkad, the richest man in Babylon. Arkad shares his secrets to wealth. Arkad explains the chief principle of wealth creation is the importance of saving at least 10% of your income (paying yourself first). “Set aside no less than one-tenth of your income, and learn to live off the rest. For if we do not, what we consider ‘necessary spends’ have a strange way of expanding to use up the available income.”

1Pay yourself first: Save at least 10% of your income before paying any bills or spending on non-essentials. This will help you build a financial cushion and develop a habit of saving.

The Cures to an Empty Purse

While paying yourself first is an essential seed for future financial freedom, there are other important principles Arkad teaches Bansir.

Arkad uses parables to explain seven principles to cure an empty purse. Parables use relatable stories and analogies to break down complex financial principles into simpler terms. This makes the lessons more accessible and easier for Bansir and others to comprehend and remember. The seven principles are:

  1. Start your purse fattening (save/pay yourself first).
  2. Control your expenditures.
  3. Make your gold multiply (invest).
  4. Guard your treasures from loss (be smart with your money don’t fall for get rick quick schemes).
  5. Make your dwelling a profitable investment.
  6. Ensure a future income.
  7. Increase your ability to earn.

Immediately after explaining the benefits of paying yourself first, Arkad teaches Bansir about the importance of controlling expenditures. These principles are related and complementary, as they both promote financial discipline and responsible money management. Controlling expenditures ensures that there is enough money left over after paying oneself first to cover essential living costs and avoid falling into debt. Together, these principles help create a strong foundation for building wealth and achieving financial success.

Arkad explains that people often struggle with managing their expenses and tend to live beyond their means. He emphasizes the importance of creating a budget and living within one’s income. Arkad explains that no matter how much one earns, their expenses will always rise to meet their income unless they take deliberate control over their spending.

To illustrate this point, Arkad asks Bansir to liken their expenses to an army of soldiers that they have to control. He tells them that they must be strict and disciplined, ensuring that they only spend on their necessities and eliminate frivolous expenditures.

2Control your expenditures: Create a budget to track your income and expenses. Prioritize your needs and eliminate unnecessary expenses. Spend less than you earn to avoid falling into debt.

Dabasir, The Camel Trader of Babylon

Arkad shares the story of Dabasir, the camel trader of Babylon as an example of someone that did not control expenses. Dabasir was once a wealthy merchant but lost his fortune due to poor financial decisions and reckless spending. He eventually fell into debt and became a slave. The story revolves around Dabasir’s journey to regain his financial freedom and the lessons he learns along the way.

While enslaved, Dabasir meets a wise man named Mathon who teaches him about managing money and paying off debts. Inspired by Mathon’s wisdom, Dabasir devises a plan to regain his freedom by repaying his debts and committing to a more disciplined financial life. He starts by dividing his income into three parts: one part for living expenses, one part for repaying debts, and one part for savings and investment. Over time, Dabasir successfully pays off all his debts, rebuilds his wealth, and becomes a prosperous camel trader.

3Eliminate debt: If you have debt, make a plan to pay it off as quickly as possible. Focus on high-interest debt first and always pay more than the minimum amount due each month.

Nomasir, Arkad’s Son

Arkad shares the story of his son Nomasir to emphasize the importance of investing in oneself. In the story, Arkad sends Nomasir to a distant city with a bag of gold and a set of clay tablets inscribed with wisdom. Arkad challenges Nomasir to return in ten years as a wealthy man, using the teachings from the clay tablets and the gold as a starting point.

Nomasir initially struggles in his journey, losing a significant portion of his gold due to poor investments and lack of experience. Realizing his mistakes, he turns to the clay tablets for guidance and begins to diligently study and apply the wisdom he finds there. Nomasir invests time in learning the local language, understanding the culture, and gaining practical skills in trade and commerce. Over time, Nomasir becomes knowledgeable and skilled in his chosen field, leading to better investment decisions and ultimately achieving significant wealth and success.

Despite having initial financial resources, Nomasir’s success was ultimately determined by his willingness to learn, adapt, and improve his skills. By investing in gaining specialized knowledge and personal development, Nomasir increased his ability to earn and make wise financial decisions, contributing to his overall wealth. By continually learning and honing skills, an individual can adapt to changing circumstances, seize new opportunities, and ultimately create a prosperous future.

4 Invest in yourself: Increase your ability to earn by continually improving your skills and knowledge. Pursue education, training, or certifications that will help you advance in your career or start a side business.

This story helps someone build wealth by illustrating that seeking out wise counsel and investing wisely are essential components of financial success. By surrounding oneself with knowledgeable and experienced individuals, one can gain valuable insights and guidance in making sound investment decisions. This, in turn, can help minimize risks, maximize returns, and ultimately lead to wealth accumulation. The story of Nomasir serves as a reminder that investing wisely, along with the guidance of wise counsel, is a cornerstone of financial prosperity.

4Be patient and disciplined: Building wealth takes time and discipline. Stick to your financial plan, stay focused on your goals, and be prepared to make adjustments as your circumstances change.

By applying the lessons from Dabasir’s story, individuals can develop better financial habits, eliminate debt, and build a foundation for lasting wealth.

Nomasir, who was given a modest sum of gold and a clay tablet containing the Five Laws of Gold, was sent on a journey to learn the ways of life and build his own fortune. Arkad instructed him to return in ten years to share his experiences and wisdom. Nomasir struggled initially, as he disregarded the Five Laws of Gold and squandered his money. However, he eventually realized the importance of the lessons on the clay tablet and started applying them to his life.

As Nomasir applies the wisdom he gains from wise counsel and the teachings from the clay tablets, he begins to make better investment decisions. Over time, his investments grow, and he accumulates wealth, ultimately achieving significant success.

The story of Nomasir demonstrates the importance of seeking out wise counsel and investing wisely. Nomasir’s initial setbacks were primarily due to his lack of experience and knowledge. By seeking advice from experts and following their guidance, he was able to make better decisions, reducing his risks and increasing the likelihood of profitable investments.

This story helps someone build wealth by illustrating that seeking out wise counsel and investing wisely are essential components of financial success. By surrounding oneself with knowledgeable and experienced individuals, one can gain valuable insights and guidance in making sound investment decisions. This, in turn, can help minimize risks, maximize returns, and ultimately lead to wealth accumulation. The story of Nomasir serves as a reminder that investing wisely, along with the guidance of wise counsel, is a cornerstone of financial prosperity.

Nomasir worked diligently to increase his knowledge and skills, learning various trades and businesses. As he honed his expertise, he found better opportunities to earn money, invest, and grow his wealth. When he returned to Babylon after ten years, he had amassed a fortune and became a successful and wealthy man.

The story of Nomasir teaches several lessons about investing in oneself and building wealth:

  1. The value of knowledge and skills: By acquiring knowledge and developing skills, Nomasir increased his ability to earn money and identify lucrative opportunities.
  2. Continuous learning: Nomasir’s success was rooted in his commitment to continuous learning and self-improvement, which allowed him to adapt to new situations and capitalize on opportunities.
  3. Applying knowledge: Nomasir’s success came from not just acquiring knowledge but also applying it effectively in his life. Implementing the lessons from the Five Laws of Gold enabled him to make better financial decisions.
  4. Patience and persistence: Building wealth and expertise takes time and dedication. Nomasir’s patience and persistence in learning and applying his knowledge eventually led to his financial success.
  5. Learning from mistakes: Nomasir’s initial failures and struggles taught him the importance of the lessons on the clay tablet. Learning from one’s mistakes can be a powerful catalyst for personal growth and financial success.

By investing in oneself through continuous learning and self-improvement, individuals can increase their earning potential, make better financial decisions, and build a solid foundation for lasting wealth.

Meet the Goddess of Good Luck: This chapter highlights the importance of seeking opportunities and taking calculated risks. The main point is that good luck favors those who are prepared and take action.

The Gold Lender of Babylon: The story of Rodan, a spear maker, who receives a gift of gold and seeks advice on how to handle it. The main point is to emphasize the importance of seeking wise counsel and being cautious with investments.

5Seek wise counsel: Consult with knowledgeable and experienced individuals, such as financial advisors or mentors, to help guide your financial decisions. Learn from their experiences and expertise.

6Invest wisely: Put your savings to work by investing in assets that generate passive income, such as stocks, bonds, real estate, or a small business. Diversify your investments to spread risk and maximize returns.

The Walls of Babylon: This chapter uses the story of the strong walls of Babylon as a metaphor for building personal financial security. The main point is to emphasize the importance of protecting and preserving one’s wealth.

7Guard your investments: Research and understand the risks associated with any investment before committing your money. Avoid overly speculative ventures or investments you don’t fully understand.

8Ensure a future income: Plan for your financial future by contributing to a retirement savings plan, such as a 401(k) or IRA. Also, consider purchasing insurance products to protect your income and assets. Seek out different ways you can earn passive income and wise investments that have a high likelihood of paying dividends. As you build your portfolio of income sources, financial freedom and lasting wealth emerge.

9Give back: As your wealth grows, consider giving back to your community or supporting charitable causes. This not only benefits others but can also help you maintain a balanced perspective on money and success.

The Five Laws of Gold

Arkad shares the five laws of gold, which serve as guidelines for wise investment practices. These laws emphasize the importance of saving, investing wisely, protecting one’s investments, avoiding unfamiliar ventures, and not expecting unreasonable returns. Arkad shares various stories to emphasize the the five laws of gold in practice.

  1. Gold comes to those who save.
  2. Gold works for those who invest wisely.
  3. Gold clings to those who protect it.
  4. Gold slips away from those who invest in unfamiliar ventures.
  5. Gold flees from those who force it to earn impossible returns.

The Gold Lender of Babylon

In this story, Rodan, a spear maker, receives a gift of gold and is unsure of how to handle it. He seeks the advice of Arkad, who advises him to seek wise counsel before making any investment decisions. Arkad shares his own experience of losing gold due to hasty and uninformed investments. The story of Arkad’s young mistakes highlights the importance of being cautious with investments and consulting knowledgeable individuals before making decisions.

The Clay Tablets from Babylon

Dabasir paid off his debts and achieved financial freedom. To do this, he consulted with wise men. Chief among them stood Mathon. Though his interaction with Mathon, Dabasir comes to understand the importance of avoiding risky investments and seeking wise counsel before committing his money.

The characters in both stories faced setbacks and financial losses due to their initial lack of experience and knowledge. By learning from their mistakes and following the guidance of knowledgeable individuals, they make better decisions, reducing risks, and increasing the likelihood of profitable investments.

Throughout these stories Arkad offers specific advice on how to avoid bad investments:

  1. Do not invest in ventures you do not understand.
  2. Avoid investments that promise high returns with little or no risk.
  3. Consult with wise and experienced advisors before making decisions.
  4. Do thorough research on any investment opportunity.
  5. Learn from the mistakes and successes of others.

Based on Arkad’s advice and common sense, here’s a checklist to help you perform due diligence when vetting investments.


  • Understand the investment: Research the investment thoroughly and ensure you comprehend its mechanics, risks, and potential rewards.
  • Verify the company’s legitimacy: Look for official registrations, licenses, and certifications. Check if the company is listed with regulatory bodies like the SEC or other relevant authorities.
  • Research the company’s management team: Investigate the backgrounds, experience, and track records of the company’s leadership to ensure they have the necessary skills and expertise.
  • Review financial statements: Analyze the company’s financial statements to evaluate its financial health, profitability, and potential for growth.
  • Check for independent reviews and ratings: Look for reviews, ratings, or analysis from reputable sources like financial publications or credit rating agencies.
  • Be cautious of unsolicited offers: Be skeptical of unsolicited investment opportunities that come via email, phone, or social media.
  • Analyze the risk-reward ratio: Ensure the potential returns are in line with the associated risks. If an investment promises high returns with minimal risk, it may be too good to be true.
  • Be cautious with high-pressure sales tactics: Scammers often use aggressive tactics to push you into making hasty decisions. Take your time and do your research before committing to any investment.
  • Trust your instincts: If something seems off or too good to be true, it probably is. Don’t be afraid to walk away from an investment if it doesn’t feel right.

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