Life-Changing Financial Lessons from Richest Man in Babylon

Posted by Dylan Westland on July 30th, 2021

"Give them a choice of gold and wisdom—what do they do? Ignore the wisdom and waste the gold. On the morrow they wail because they have no more gold.

Gold is reserved for those who know its laws and abide by them."

George S. Clason’s The Richest Man in Babylon, frequentailly abbreviated as Babylon, could most accurately fit the definition of “the true bible of wealth” as it presents itself as a collection of parables set over 4,000 years ago. Babylon draws exceptional similarities to the Holy Bible’s utilization of metaphors, symbols, and allegories in order to convey a powerful message while simultaneously avoiding mentioning specific niches or economical situations for the greater purpose of establishing itself as a timeless classic. As expected, Clason’s efforts of making a timeless novel have been proven valid as the self-help parable is still widely read today despite it nearing its 100 year anniversary since publication.

Babylon has a lot of useful lessons to offer (which it seems overly self-aware of, noting the “THE SUCCESS SECRETS OF THE ANCIENTS - THE MOST INSPIRING BOOK ON WEALTH EVER WRITTEN” printed on the front cover). Although its broad themes and archaic language prevent it from falling out of public favor in a rapidly evolving “politically correct” society (a problem which Napoleon Hill’s Think and Grow Rich is facing due to its underlying of misogyny, among other things), Babylon falls short through the fact that it is an extremely difficult read. Babylon is scattered with hidden meanings, complicated allegories, and painfully biblical-esque word usage (e.g.,“make thy gold multiply”, “seven curses for a lean purse”, “thereby shalt thou acquire confidence in thy self to achieve thy carefully desires”)

A thorough reading and proper annotation of Babylon can take several hours. This article is going to summarize, simplify, and illustrate the key lessons from George Clarson’s masterpiece.

The Man Who Desired Gold
The characteristics that keep the lower class poor; the ideological difference between the Rich and the Poor (growth vs. fixed mindset).

Babylon begins first by telling the prerequisite story of how two common men met and heard the story of Arkad, the richest man in Babylon. Comparing themselves to him, the two men complain of their unfavorable financial situation alongside their discomfort in the labor of their current jobs:

    “Perhaps there is some secret we might learn if we sought it from those who knew … I wish an income that will keep flowing into my purse whether I sit upon the wall or travel to far lands”

Clason in this chapter first discusses the lack of financial literacy. In the beginning, two friends complain to each other that they are unsure what “secrets” the ultra rich hold in order to become successful. The two men realize the wealth discrepancy between themselves and the elite class in Babylon, but resort to complaining rather than taking incentive to find success.

Key lessons:

  1. Having a poor mindset results in living a poor life, optimism and education are the only ways to change your situation. A poor life with a job you hate just to survive is no better than enslavement.
    “Yet, thou dost make me see how little better off are we, free men” (6)

  2. In society, there will always be potential to capitalize.
    “Are we more than dumb sheep? We live in the richest city in the world.” (5)

  3. Desires and daydreaming, “wishes”, will get you nowhere if you never act upon them.
    “I wish to own lands and cattle, to have fine robes and coins in my purse.” (7)

The Richest Man in Babylon
The introduction of Arkad, the Richest Man in Babylon.

A well respected and renowned man, Arkad, titled the “Richest Man in Babylon” runs into some old friends from his childhood. They recognize him, but are dumbfounded at the fact that their childhood friend, who they had viewed as trivial, had become so successful. They urgently ask him about his story and advice, and Arkad proceeds to tell the methods of his wealth.

  • Arkad explained that he was no wiser, nor stronger than either of the men, evening revealing he is actually below average compared to them.
    “Once we were equal. We studied under the same master and played the same games … neither did you outshine us.” (9) [an allusion to insignificance of academic or athletic performance in relation to success]

  • He states that all the men from their childhood who had inherited wealth lacked good habits and financial literacy and were unable to manage their assets, resulting in them becoming bankrupt.
    “On the contrary, [the goddess of luck] brings ruin to almost every man upon whom she showers unearned gold. She makes wanton spenders, who soon dissipate all they receive and are left beset by overwhelming appetites and desires they have not the ability to gratify. Yet others whom she favors become misers and hoard their wealth, fearing to spend what they have, knowing they do not possess the ability to replace it. They further are beset by fear of robbers and doom themselves to lives of emptiness and secret misery.” (10)

  • He first stated that he manifested becoming rich.
    “I decided to myself that I would claim my share of the good things of life. I would not be one of those who stand afar off enviously watching others enjoy.” (13)

  • Arkad also understood that success does not come easily nor quickly. His success would take time and preparation.
    “I decided that if I was to achieve what I desired, time and study would be required” (15)

  • In order to make this goal possible, Arkad understood that he had to educate himself. He quickly figured out you can get most things in life just by asking, and that man fears asking others for guidance because of their low self esteem, anxiety, and laziness. Arkad made use of this fact by asking for an (unpaid) apprenticeship under every successful man he could find in order to learn.

  • Contrary to many modern nihilistic philosophies, Arkad argues that men have ample amount of time. He explains every man has more than enough time to become wealthy and live a good life.
    “As for time, all men have it in abundance … sufficient time to have made yourselves wealthy.” (18)

Arkad then splits the the rest of the book into four key principles: The Five Laws of Gold (the pronounced laws of accumulating wealth), The Seven Cures for a Lean Purse (how to apply the five laws of gold), The Goddess Of Good Luck (luck favors those who don’t procrastinate), Gold Lender of Babylon (how to evaluate your investments), and The Camel Trader of Babylon (escaping unfavorable circumstances).

The Five Laws of Gold
Arkad dictates the five unbreakable laws of wealth.

Law I

Literal text Simplification
Gold cometh gladly and in increasing quantity to any man who will put by not less than one-tenth of his earnings to create an estate for his future and that of his family. Wealth accumulates around those who save. One must save (atleast) 10% of all their earnings instantly as they receive their paycheck, before using their earned money to buy anything else.

“A part of all I earned was mine to keep”

  • Definitely the most important lesson from Babylon, Arkad explains that the most important rule of accumulation is to always “pay yourself" first before paying others. In simple terms, Arkad is stating that once you get your paycheck, you must allocate a portion (something around 10%) to yourself (your savings accounts & investments). He explains that it is absurd that the majority of the “sheep” population pays everyone else before paying themselves (paying for food, clothes, entertainment, other material goods).
    “Do you not pay the garment- maker? Do you not pay the sandalmaker? Do you not pay for the things you eat? Can you live in Babylon without spending? What have you to show for your earnings of the past mouth? What for the past year? Fool! You pay to everyone but yourself. Dullard, you labor for others. As well be a slave and work for what your master gives you to eat and wear. If you did keep for yourself one-tenth of all you earn, how much would you have in ten years?” (14)

Law II

Literal text Simplification
Gold laboreth diligently and contentedly for the wise owner who finds for it profitable employment, multiplying even as the flocks of the field. Money will create more money if invested wisely. Using compound interest, one can multiply their wealth exponentially over time.

“Every gold piece you save is a slave to work for you”

  • Arkad is explaining that all the money he saved produces even more money for him, through profitable and safe investments.

  • Arkad urges his friends to invest in sources of passive income with their savings, giving them the logical explanation that it will overall produce more money for them without the need of too much effort.


Literal text Simplification
Gold clingeth to the protection of the cautious owner who invests it under the advice of men wise in its handling. Wealth accumulates under the person who is constantly learning (growth mindset) and is seeking advice from those who are much wiser than he.

“Advice is one thing that is freely given away but watch that you take only what is worth having”

  • Arkad reinforces the importance of seeking advice. He explains that the only way he, as a naive young man, had become successful was from seeking advice from those much more knowledgeable and successful than him.

  • However, he also warns that there is advice and information in surplus (which has become even more relevant in the modern age, with the widespread use, accessibility, and ease of publishing on the internet).

  • He encourages people to seek advice from those educated/experienced in the certain subject which they want to enter.
    "'Every fool must learn,' he growled, 'but why trust the knowledge of a brickmaker about jewels? Would you go to the breadmaker to inquire about the stars? No, by my tunic, you would go to the astrologer, if you had power to think. Your savings are gone, youth, you have jerked your wealthtree up by the roots. But plant another. Try again. And next time if you would have advice about jewels, go to the jewel merchant. If you would know the truth about sheep, go to the herdsman. Advice is one thing that is freely given away, but watch that you take only what is worth having. He who takes advice about his savings from one who is inexperienced in such matters, shall pay with his savings for proving the falsity of their opinions.'” (24)

Law IV

Literal text Simplification
Gold slippeth away from the man who invests it in businesses or purposes with which he is not familiar or which are not approved by those skilled in its keep. One must first educate themselves thoroughly before embarking on a business or investment.

  • Arkad explains that many people who desire to become “entrepreneurs” try to start a business with a subject that they know nothing about. Tying back to the importance of seeking good advice (alongside an allusion to the importance of a college education, which is slowly becoming politically/economically incorrect in society), Arkad warns those who are wanting to start a business

  • He furthermore adds that he sees a trend with wealthy children who inherit their father’s assets and businesses without proper understanding or experience.

Law V

Literal text Simplification
Gold flees the man who would force it to impossible earnings or who followeth the alluring advice of tricksters and schemers or who trusts it to his own inexperience and romantic desires in investment. “Get Rich Quick” scams are impossible; anyone who claims they can get you extremely rich in a short period of time is a liar.

  • Arkad warns of scammers who are only looking to steal your money. Frequently, these men offer deals that promise to give you large returns on your initial investment in short periods of time. He further explains that these men, along with being very confident and sociable, are not here to help you, reinforcing that no one does anything for free, rather someone always wants something from you.

  • Investments which promise high return in a short amount of time with very little effort are almost certainly scams.

The Seven Cures for a Lean Purse
Arkad further explains the principles to cure a “lean purse”, or a small bank account, and start growing your wealth.

  1. Start thy purse to fattening
    Commit yourself to saving a good portion of your money. Arkad explains once he started following his 10% rule of saving, his life & expenditures didn’t change significantly, he hadn’t even noticed that his spending power was any different.

  2. Control thy expenditures
    Have self control over your spending habits. Don’t confuse “wants” with “needs” when you don’t have the capital to do so. Arkad explains that life is about leisure, but it is important to refrain from spending while in the process of building wealth in order to ensure a retirement of leisure and relaxation.

  3. Make thy gold multiply
    Always be finding passive ways to multiply your wealth. Having your wealth increasing through profitable investments is much more valuable than it sitting in a savings bank account (losing its value)

  4. Guard thy treasures from loss
    One should take multiple security measures to ensure that their hard earned money will not be taken from them in a rapid turn of events. Many realized (and overlooked) this principle during the COVID-19 pandemic, when millions of people lost their entire fortune because they were not careful. Arkad explains the importance of having multiple sources of income, insurance, stable investments (bonds, physical assets). By not "keeping all the eggs in one basket", his wealth is secured.

  5. Own thy home & make thy dwelling a profitable investment
    This is personally one of my favorite (and most overlooked) cures. I remember being around 11 years old and my mother, a real estate broker who later gifted me the book Babylon, was explaining to me that the most important principle of wealth was to own your home.

  6. Arkad explains that it is important to make your own home profitable. Buy or build it carefully, ensuring that it will increase value in the years to come.

  7. Ensure a future income
    Create a retirement plan. Once you turn 18, start a Roth IRA to ensure that you will have a leaisurful retirement and confirm the protection of your family.

  8. Increase thy ability to learn
    Always be learning. Always stay humble. The most effective and successful people don’t believe that they already know everything, instead they read books constantly and watch the news.

  9. Meet The Goddess Of Good Luck
    Arkad explains what the reality of “luck” really is in a capitalist society.

    • Arkad explains that the “Goddess Of Good Luck” favors those who don’t procrastinate. He explains that those who act upon an opportunity usually receive the “good luck” that many who procrastinate believe their life is devoid of.

    • Arkad encourages those to act when they see opportunities instead of procrastinating, and they will receive help from the “goddess of good luck” (e.g. starting a business that you see a specific and profitable niche for, rather than convincing yourself “probably going to fail, not worth the effort”)

    The Gold Lender of Babylon
    The story of the gold lender of Babylon explains the importance of being logical, not emotional, with how you lend/invest your money. In this chapter, Arkad tells the story of a Gold Lender who can became bankrupt because he offered loans to his friends and family members because, although logically he knew that they did not have the facilities to ensure a payback, emotionally he felt inclined to loan to them.

    • It is important to have an in-depth understanding of who is going to be handling your money.

    • While it is noble to lend a hand, it is critical to make certain that you are not taking on the burden for yourself. (this is one of the most important lessons from Babylon. It applies much further than finance)

    • “Better a little caution than a great regret”

    TThe Camel Trader of Babylon
    The Camel trader of Babylon tells the story of Dabasir, a man who had turned to crime and had become enslaved. Destined to change his undesirable fate, he was determined to work until he had paid off all his debts and lived a life of luxury. .

    • Many people allow self-pity and poor circumstances control them, using them as an excuse not to change their life.

    • Many people possess “the soul of a slave”, where they believe that they are helpless and cannot escape their situation. Often these people, believing that their circumstances are not in their control, blame others for their unhappiness.

    • One must take charge of their life in order to escape unfavorable circumstances. Using determination, courage, and education, one can take action to make themselves happy.

    Babylon gives amazing financial advice. Many people, especially young, do not know how to manage their money or assets properly, so it is important to apply these basic principles to your life. Through its simplicity, the book will most likely stay relevant for decades to come.

    "Money is plentiful for those who understand the simple laws which govern its acquisition."