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The Richest Man in Babylon

Investment Lessons from Babylon

- The 7 Cures for a Lean Purse *

  1. Start thy Purse to Fattening
    • Save at least 10% of what you earn and your purse will start to fatten
    • A penny saved is a penny earned
    • Pay yourself first is the most important bill you will pay each month
  2. Control thy Expenditures
    • Control your expenses with a budget
    • We all tend to live according to whatever income we earn, unless we protest to the contrary
    • Look closely at your cost of borrowing!
  1. Make thy Gold Multiply
    • Wealth creation is not about coins carried in the purse, but the golden stream of annuity income that flows from the purse
    • Remember the Power of Compounding!
  2. Guard thy Treasures from Loss
    • Seek safety first / security of principal
    • Invest only with investment professionals
    • Beware of suretyship
    • If a scheme / interest rate seems too good to be true, it probably is
    • Beware of pyramid schemes / gambling
  3. Make of thy Dwelling a Profitable Investment
    • Own your home
    • It is a well established fact of life that on average home owners have higher net worth's than renters
    • Never spend more than 1/3 of your income on your mortgage
  4. Insure a Future Income
    • Provide for the protection of your family, your health and your old age through Life Assurance and Retirement Planning
    • Research has shown that less than 10% of people plan adequately for retirement - why?
  5. Increase thy Ability to Earn
    • As you enhance your skills and wisdom, so will you increase your ability to earn ("Learn before you earn")
    • Your career is your # 1 asset
    • Get a mentor / hero!
      • Warren Buffet
      • John Templeton
      • Benjamin Graham
      • Anton Rupert

* Source: The Richest Man in Babylon - George S. Clason

Related Tags: - investment principles
01-05-2008