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I picked up a copy of The Richest Man in Babylon from my public library recently. I have only read through about half of the book so far. But, I couldn’t wait to write a post about it. The book is told as a story instead of just giving a bunch of financial advice, and I found this refreshing and different. Here are some of my favorite parts of the book.
If each of you desireth to build for himself a fortune, is it not wise to start by utilizing that source of wealth which he already has established? (page 35)
This is such a good point. First of all, start with your family’s income and make a plan for that money. Sure getting a raise would be nice or making a side income would help your finances. But, don’t overlook the income you have coming in now. Create a plan with what you have now and learn to manage that money first. Do so, even if it is less than you want to be making. Once you are doing that, then you will be in a great position going forward when your income increases.
That what each of us calls our “necessary expenses” will always grow equal our incomes unless we protest to the contrary. (page 38)
You can call this lifestyle inflation. This is the concept that the more money you make, the more money you spend. Give your finances a look through, and see if you have added any new expenses lately. You might be surprised at what you find. These expenses can creep into our lives sometimes. Often, without us even noticing. Consequently, these expenses make us think our total necessary living expenses are higher than they really have to be.
We save money by not increasing our expenses as our income increases. Just because you got a raise at work, for instance, doesn’t mean you have to spend that extra money. Save it, use it to pay off debt, or invest it. Just whatever you do, don’t waste it.
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 realize thy most cherised desires by defending them from thy casual wishes. (page 40)
I believe in spending your money on what you value the most in your life. Try to plan your spending and saving based on what your priorities are. First, make sure all of your basic necessities are covered each month. Then, begin funding your goals and your priorities. It’s easy to waste money on things we don’t care that much about. A budget can be a great strategy for you to use each month which will help you make sure your money is going where you want it to go.
The Richest Man in Babylon is written by George S. Clason. You can find the book for sale on Amazon for $9.97. Don’t forget to check your local library first because it’s FREE!
Have you read The Richest Man in Babylon? If so, leave a comment below and let me know what you thought about the book.