I am writing this to put into action a principle I learned from Dr Stephen Covey. Dr Covey states in the opening of his best selling book, The 7 Habits of Highly Effective People, that once you have learned something you must teach it to someone else within 24 hours of learning it.
I started listening to an audiobook that I had been putting off for sometime. I try to pick what I read quite carefully, making sure that the time I give to a book is towards my mission and goals. The book is “The Richest Man in Babylon” by George Samuel Clason, and although this book features on most entrepreneur’s reading lists, I have chosen not to read it in fear that it was outdated. This leads me to my first lesson for the day, DON’T JUDGE A BOOK BY ITS COVER!
I will write in more detail about the book as it is a bountiful resource to life and business, but for today I am going to share a list of “Cures for a Lean Purse” as it is stated in the book. George Clason writes the book in the form of parables from Babylon and uses King James era language so for the benefit of those that don’t read books, or would start and get lost in the language because you have easier books, blogs, and articles you could read I will break these down.
So to set the scene; the King of Babylon, Sargon of Akkad is told by is advisors that the kingdom needs to become more wealthy and that the only way for this to become reality, was to seek to make its population wealthy as individuals. The King called on the richest and most successful in the Kingdom, a man called Arkad, to teach 100 men how to accumulate wealth that they may in turn teach others, which in turn will result in the Kingdom becoming more wealthy.
Arkad delivers 7 steps to cure a lean purse. Below are these 7 steps written to reflect our lives in the present day;
Every journey starts with single step, but looking at a 100 mile hike from the first step can be demoralising. So to control your emotions and set your expectations we need to set up a rule and agreement with ourselves.
The Rule: From any money earned, set a minimum of 10% aside. This can be called your Opportunity Account.
This principle has been proved time and time again. You do not need great capital to create wealth. A combination of discipline, control, mission focus, and the principle of compounding will do a fair bit of work for you.
2. Control Yourself
“10% before I pay my bills, I couldn’t live!” – A lot of people would certainly allow this to be their response. These people frequently say, “I would do more to be successful but I haven’t got the time!”. The book states this step as “Control thy Expenditure”, but in my experience the reality this is control yourself. You will have a hard time controlling anything if you are not in control of yourself.
Draw up a budget, check your monthly expenses and shave off what you don’t NEED so that you can live within 90% of your income. The principle in step one will become a habit in no time and you will be on your way!
3. Make it Grow
You’ve done the hard part in adjusting your life and setting new habits, now you have to make sure you are making your money work for you. This means investing your nest egg. Make sure your Opportunity Account is a high interest account, and then seek advice and educate yourself so that you can invest your cash appropriately and make it grow!
4. Keep it Safe
The pot is now filling up, you’re excited that some simple changes have caused bigger things than you had thought possible before now. You start hearing from friends, colleagues, and “experts” offering you fantastic deals, promising high returns. Your excitement peaks as you know its possible to grow your wealth, you’ve already proved that through your diligence. You need to safeguard yourself from these things as excitement will cause you to risk the lot – if its too good to be true, it most likely is.
Educate yourself and only take advice from proven professionals. There is a lot of free information out there, but it may be worth getting paid advice to set your steps in the right direction and to protect your assets.
5. Own Your Place
Everyone has to live somewhere, so seek to make your place your own. Renters will never own anything, while even mortgages come to an end. “The Richest Man in Babylon” by George Samuel Clason titles this cure as follows; Make of thy dwelling a profitable investment. You can take a view of this as you will, the principal remaining the same, treat your living space as an opportunity. Perhaps if renting is your lot for the time being, seek a lease where you can take on sub-tenants as the law allows, which may give you the chance to break even or even profit.
Thinking outside the box is key!
6. Plan for your Family
We all want to believe that we have a blessed existence and that bad, difficult, or life changing events that happen to others around us wont happen to us. Sadly, this is not always the case but even more poignant when you have children or dependants. Many a rich man has left his family with burden through failing to plan, and what is the point of working through your heart beats only to leave a burden in place of the intended treasures. Failing to plan is planning to fail. Consider seeking professional advice for writing a will, life insurances, and asset protection.
7. Increase your Mind – Grow your Ability
Humans have amazing minds and our greatest treasure is not accumulated or inherited wealth, similarly success and wealth is not counted on a single win. History does not record one time victors, instead celebrates those that develop themselves through education and practice, and those that further develop systems that succeed over and over again. Establish yourself in a trade, study it and grow your ability and knowledge. Doing this makes you more valuable to any organisation, which in turn increases your ability to earn.
Perhaps, like me, you are not the career type. We live in a free information era, regardless of who you are and what you want to do, there is an abundance of information for your to learn. The only ingredient needed is your willingness to succeed!
These principles have stood the test of time, they are not made invalid with the use of technology and can be established by any person. So if you want to cure your empty purse, take the big step and commit to implementing them in your life.
I have been heavily impacted by this book. The 7 cures mentioned above may have been reworded to be easier to digest, however they remain the author’s concepts. If you have enjoyed this, then I would highly recommend reading the book and putting your own understanding to its words.
Thank you for reading!