Without financial discipline, the successful salesperson will part with their commissions as quickly as they have earned it. No matter how much you currently earn, learning to manage your money is critical for long-lasting security and stability. In “The Richest Man in Babylon,” George S. Clason teaches sound and practical principles through parables from the ancient civilization of Babylon. Originally published in 1926, it remains an inspiring and influential piece due to its timeless lessons. Here are my interpretations of the principles taught:
The Richest Man in Babylon Principle #1: Start thy purse to fattening
Make a firm decision to start growing your net worth. This is the first and most important step towards financial stability and security as it lays the foundation for all the other 7 principles.
The Richest Man in Babylon Principle #2: Control thy expenditure
Spend less than you earn. The book recommends 10% of your income be allocated for your savings/investments, and that you live off the remaining 90%. My personal opinion is to allocate a further 10% for contributing back to society or your religious organisation, but this obviously falls outside the scope of this book.
The Richest Man in Babylon Principle #3: Make thy gold multiply
Put your savings where it will grow. Whether you are putting it into your mortgage to reduce interest, the stock market, or an interest-bearing savings account, make sure that wherever you put it, it will work for you.
Principle #4: Guard thy treasures from loss
Guard against losing your savings. Do not invest in places that you have no knowledge or expertise in. This may include real estate, the stock market, business ventures, and the like. Purchasing insurance is another way of protecting your investments from loss.
Principle #5: Make of thy dwelling a profitable investment
Own your own home. Even in ancient times this was applicable, and it is no different today.
Principle #6: Insure a future income
Invest towards your retirement. In Australia we are fortunate enough to have mandatory Superannuation for permanent job positions, however it remains important to plan for the time when you will no longer be able to do the work you do now.
Principle #7 Increase thy ability to earn
There’s no way to further simplify this principle, and it is probably the most important of all. We all started with no income, and have steadily increased it through education, training, and experience. There is absolutely no reason in our “land of opportunity” that you can’t continue on this pathway. Live the principle of “Kaizen,” which is the regular and incremental improvement of your skills, knowledge, and experience.
While this book is applicable for anyone capable of earning an income, with salespeople having very high earning potential I believe it is essential reading for managing their hard earned commissions. Check out the links below to secure your copy!
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