A Part Of Everything You Earn
… Is yours to keep
In “The Richest Man In Babylon,” lessons about wealth building are taught in stories. The first story begins in Chapter two, where the chariot maker is sitting and pondering his life. He can’t understand why his purse is empty, despite having made plenty of money creating chariots for rich people and being paid well for it over the years.
His friend, a musician, is in the same predicament. Despite having made plenty of money for many years, he too has an empty purse and nothing to show for it.
They decide together to visit a childhood friend who is now considered to be the richest man in Babylon. They realize that asking for advice and knowledge costs nothing, so they figured they could go ask this friend to teach them how to become wealthy.
The rich friend–Arkad–had a childhood very similar to the others. None were raised wealthy, and none had inherited any wealth from previous generations.
Arkad told his story to these two friends: He was a poor scribe when he first started his adult life, and he took the initiative to ask another rich man early on in life how he could acquire wealth. The man was a money lender and quite rich at the time.
This man told Arkad “a part of all you earn is yours to keep.”
Arkad didn’t understand at first though. He thought everything he earned was his to keep but the money lender pointed out how he had to give money to the garment maker for robes, the sandal maker for shoes, and he had to pay money for food. In fact, he explained you couldn’t live in Babylon without spending money.
What have you to show for your earnings the past month? What for the past year? Fool, you pay to everyone but yourself. Dullard, you labor for others. As well be a slave and work for what your master gives you to eat and wear.
The key he said, is to pay yourself first. Don’t give money to the garment maker, spend money on food, or give it to anyone else before you’ve given yourself at least 10%.
Pay yourself no less than 10% of everything you earn, then do not spend any more than the remaining 90% on sandals, garments, food and other niceties.
This law of wealth building is so simple that many people miss it. And still others argue they can’t afford to live off of 90% of their earnings, because they can’t even pay for everything with 100% of what they make.
As strange as it may sound though, reducing your spendable income is much easier than you can imagine. The easiest way to do it is to have money automatically taken from your paycheck and put into savings before you even receive your check. Since you pay your bills with what’s on the check itself, you will automatically adjust to the smaller amount, not even noticing the part that’s been put away.
If you work for yourself or can’t have money automatically taken out before you receive payments for work, then you have to be more disciplined. It takes work at first, but each time you force yourself to do it the process becomes easier and easier. In a very short time, it will be a habit that you don’t even think twice about.
Not paying yourself is the equivalent of being someone else’s slave. You’re letting others control your life, your choices and your actions on a day-to-day basis and you will never be able to get ahead.
Ask yourself how much money you’ve made in the last year? How much in the last ten years? And how much of that money is still in your pocket, bank account or investments today? How much is still yours that you’ve kept?
Wealth starts with one tiny little seed… And if you don’t plant that seed, you’ll never be able to start that wealth growing.
Do it now. Pay yourself 10% of your earnings today, and pay yourself first every single day for the rest of your life.
Tags: money management, personal finance
