On previous articles, I shared my experience and lessons learned after reading the book entitled, The Richest Man in Babylon. You can read the 5 self-help lessons here and 7 cures for the lean purse here from The Richest Man in Babylon book I shared.
This is a good read and a life-changing book that can ignite your passion in personal finance and take your financial life to the next level. As I also shared before, investing in ourselves first is the best investment we could ever have.
Today, I will share the final set of lessons that I think that can help us in our financial freedom journey and that is the 5 laws of gold from the Richest Man in Babylon book.
This will give us another valuable idea on how to accumulate wealth and take care of our finances. It’s a worth-reading and must-sharing article for everyone especially for beginners like me. Let’s start.
“A bag heavy with gold or a clay tablet carved with words of wisdom; if thou hadst thy choice, which wouldst thou choose?”
This is the initial statement on this chapter from Kalabab who asked the Babylonians on the Richest Man in Babylon book. As he assumed, the people chose gold instead of wisdom.
While others want gold, the others seek wisdom that they can use and apply on their lives to accumulate wealth. Kalabab willingly shared story about Nomasir, the son of Arkad (the richest man in Babylon).
When Nomasir reached the right age, Arkad didn’t approve to inherit his estate to Nomasir immediately. Arkad want Nomasir to prove that he is capable of wisely handling his wealth before he can inherit it to his son.
Arkad gave two things to Nomasir to start his journey. A bag of gold that he can use to build his own wealth and a clay tablet where the 5 laws of gold were carved to guide him acquiring wealth if apply in his own life.
Nomasir expected to return after 10 years and if he didn’t prove that he deserve his father’s wealth, it will be donated to the priests.
Ten years after, Nomasir went back to his father (Arkad) and shared his journey. As usual like any other classic tale, Nomasir lost all those gold by not investing them in the right way at the beginning.
He went bankrupt along the way. He sold his horse, his slaves, his robes just to survive. But he didn’t give up. He remembered that he was given a clay tablet by his father where 5 laws of gold were carved. He read it carefully and apply in his life.
By following those 5 laws of gold, he figured out to change his life. He overcome those challenges and accumulate wealth. He prove his father that he deserve Arkad’s estate.
Here’s Nomasir statement taken from the richest man in babylon book:
“But in those bitter days, I remembered thy confidence in me, my father. Thou hadst sent me forth to become a man, and this I was determined to accomplish.’ The mother buried her face and wept softly. At this time, I bethought me of the tablet thou had given to me upon which thou had carved the five laws of gold.
Thereupon, I read most carefully thy words of wisdom, and realized that had I but sought wisdom first, my gold would not have been lost to me. I learned by heart each law and determined that, when once more the goddess of good fortune smiled upon me, I would be guided by the wisdom of age and not by the inexperience of youth.”
And to share you the 5 laws of gold that guide Nomasir in his journey, here they are.
The 5 Laws of Gold
1. 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
This basically tell us to save at least 10% of our income. No matter how small and how hard it is, we should learn to discipline our selves to save that 10%. We should learn tracking our expenses and learn how to budget.
That 10% save will ONLY be use for wise investment to grow our money. Here’s an inspiring quote from this 1st law of gold.
“Any man who will put by one-tenth of his earnings consistently and invest it wisely will surely create a valuable estate that will provide an income for him in the future and further guarantee safety for his family in case the gods call him to the world of darkness.
This law always sayeth that gold cometh gladly to such a man. I can truly certify this in my own life. The more gold I accumulate, the more readily it comes to me and in increased quantities. The gold which I save earns more, even as yours will, and its earnings earn more, and this is the working out of the first law.”
2. Gold laboreth diligently and contentedly for the wise owner who finds for it profitable employment, multiplying even as the flocks of the field.
This 2nd law of gold teach us that once we learn how to invest properly, we can create streams of income to multiply and grow our money. If we properly manage our investment, sooner than later we’ll reach all of our financial goals.
A good investment will grow over time on its own and will use the most powerful force in the univers – the compounding interest. Let’s all start small and take one step forward.
“Gold, indeed, is a willing worker. It is ever eager to multiply when opportunity presents itself.To every man who hath a store of gold set by, opportunity comes for its most profitable use. As the years pass, it multiplies itself in surprising fashion.”
3. Gold clingeth to the protection of the cautious owner who invests it under the advice of men wise in its handling.
This law basically tell us that we need to protect our investment and learn to be cautious. That is why it is always advisable to invest in ourselves first to learn the basic and fundamental of proper personal finance.
By being financially educated, we are lowering the risks involved in every financial decision we make in our lives. We can attend seminars, training, read personal finance blogs and many more. We should educate ourselves and learn how to protect our wealth.
“Gold, indeed, clingeth to the cautious owner, even as it flees the careless owner. The man who seeks the advice of men wise in handling gold soon learneth not to jeopardize his treasure, but to preserve in safety and to enjoy in contentment its consistent increase.”
4. 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 who are skilled in its keep.
This 4th law of gold telling us to only invest in things we deeply understand. We should always be wary on those investments that promise to give high return in a short amount of time without understanding them. As a rule of thumb, “Aral muna bago invest” as advised by Sir Aya.
I have an article that shares 3 tips to avoid financial scams in the Philippines here and investment scam checklist here that you can read to gain additional information. We should only invest on the things we understand.
“To the man who hath gold, yet is not skilled in its handling, many uses for it appear most profitable. Too often these are fraught with danger of loss, and if properly analyzed by wise men, show small possibility of profit.
Therefore, the inexperienced owner of gold who trusts to his own judgment and invests it in business or purposes with which he is not familiar, too often finds his judgment imperfect, and pays with his treasure for his inexperience. Wise, indeed is he who investeth his treasures under the advice of men skilled In the ways of gold.”
5. 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.
As mentioned above, we should not be hooked with the promise of high returns especially if we really don’t understand the investments. We should take time to learn and study first.
Doing some research or getting advise from the expert is the best thing we could do to avoid being scammed. Take it slowly but surely. Invest only on the
things you know.
“Fanciful propositions that thrill like adventure tales always come to the new owner of gold.These appear to endow his treasure with magic powers that will enable it to make impossible earnings. Yet heed ye the wise men for verily they know the risks that lurk behind every plan to make great wealth suddenly.”
Alright, those are the 5 laws of gold shared in The Richest Man in Babylon book. I hope that by sharing these, I provided some valuable lessons that you can apply in your own life. These are great lessons that can really change our life if followed and applied correctly.
The Richest Man in Babylon book is one of the best personal finance book I’ve read so far. It teaches a lot of lessons that are still applicable in our life today. Those lessons I shared from couple of articles are worth-reading and can provide you valuable information in your financial freedom journey.
I hope that by sharing these lessons, I gave you another resources that you can use in your own life. This is a great book. I will definitely read it again!
You can also read my previous article about 3 Important life lessons from the 8 habits of the happy millionaire book by Bo Sanchez here. That’s also a worth-reading article.
In the coming future, I will share lessons and insights from all of the personal finance books I’ll read. There is more to come. I encourage you to do the same. Take some 15-30 minutes everyday to read a book or ebook like this and it will definitely give you priceless lessons that you can use and apply in your own life.
When you start a reading habit with books like these, it will make you more informed financially.
And lastly, let’s practice and apply all the lessons we learned from these books to see the results in our life. That is basically the most important thing we need to do. Read and learn and then apply.
Let’s all take one step forward to financial freedom. Cheers!