Clason's "The Richest Man in Babylon" Reveals the Fastest Way to Become Financially Savvy - Part 1

Copyright 2007 Ed Bagley

George Clason's book "The Richest Man in Babylon" reveals the fastest way to become financially savvy. It works today because money is governed today by the same laws that controlled it when prosperous men thronged the streets of Babylon 6,000 years ago.

Here is a synopsis of The Richest Man in Babylon and the important financial lessons it teaches:

A self-employed chariot builder becomes discouraged when, after years of hard work, he realizes that he will never become rich. He labors hard to build the finest chariots in the land, soft-heartedly hoping that some day the Gods will recognize his worthy deeds, and bestow upon him great prosperity.

He now realizes that the Gods could give a care about the work on his excellent chariots. He longs to be a man of means, and have the lifestyle of the richest man in Babylon, who was a childhood friend.

He confers with his best friend, a musician, who reminds him that it is not enough to have a fat wallet, as a man's wealth is not in the wallet he carries, because a fat wallet quickly empties if there be no golden stream to refill it.

The chariot builder decides to confront the richest man in Babylon, who he knew in his youth, and learn how he became so rich.

The chariot builder shares his lament with the richest man in Babylon, knowing that both he and the richest man in Babylon were once equal, played the same games in childhood, studied under the same masters, had equal talent and ability, and worked just as hard; now he works just as hard but his childhood companion has become the richest man in Babylon, while he still struggles.

The rich man replies, "If you have not acquired more than a bare existence in the years since we were youths, it is because you either have failed to learn the laws that govern the building of wealth, or else you do not observe them."

The richest man then explains that he had learned how to become rich from a moneylender, for whom he had provided a service in exchange for the moneylender's secret to success.

The moneylender said, "I found the road to wealth when I decided that a part of all I earned was mine to keep, and so will you."

The money lender tells the rich man, who was then a scribe in the hall of records, to set aside one-tenth of all he earns as his portion to keep.

A year later the young scribe comes back to the moneylender, who asks him if he has kept a tenth of all he earned.

When the scribe replies yes, the moneylender asks him what he has done with it.

The scribe says he has given it to a bricklayer who was going to foreign lands to buy jewels, which he and the bricklayer would sell for profit when he returned. The scribe ends up with nothing, as the bricklayer is sold worthless glass rather than fine jewels.

"Every fool must learn", says the money lender, "but why trust the knowledge of a bricklayer about jewels? Your savings are gone," continues the moneylender, "you have jerked up your wealth-tree by the roots. But plant another. Try again. And, this time, if you would have advice about jewels, go to the jewel merchant."

Another year passes, and again the scribe goes to the money lender, to tell him that he had saved one-tenth and given it to a shield maker to buy bronze, and each fourth month the shield maker pays him rental.

"That is good," says the moneylender, "And what did you do with the rental?" "I had a great feast and bought a beautiful scarlet tunic," replies the scribe.

"You squander your savings," admonishes the moneylender. "How do you expect your savings to work for you, and generate more savings to work for you? Get yourself an army of golden slaves to work for you, then many a rich banquet you may enjoy without regret."

Two years later the scribe again goes to the money lender, to tell him that he still saves one-tenth, invests it more wisely and now continues to do so. "Each time I loaned money to the shield maker, I loaned back also the rental he had paid me. Therefore not only did my capital increase, but its earnings likewise increased."

"You have learned your lessons well," says the moneylender.

"You first learned to live upon less than you could earn. Next you learned to seek advice from those who were competent through their own experience to give it. And, lastly, you have learned how to put money to work for you.

"You have taught yourself how to acquire money, how to keep it, and how to use your money to prosper. You are now competent for a responsible position."

The scribe goes on to become the richest man in Babylon.

It was apparent that no one could do for the scribe what the scribe had done for himself. Each man has to work out his own understanding of what needs to be done, and then prepare himself to take advantage of the opportunity to succeed in a big way.

The moral to the story The Richest Man in Babylon teaches this lesson: Proper preparation is the key to our success.

Home Loans Are A Way To Fulfill Your Dreams, But Do Not Let Them Become A Nightmare!

Buying a house will probably be one of the most important things that will happen in your life. Having the desire of doing it is nothing compared with the moment in which you make the real decision. It is also in that moment when you have to face all those many times forgotten details that could turn a beautiful dream into the most awful nightmare if you do not pay attention to them in the right moment.

The Right Moment

After thinking it carefully, you have decided that the right moment to buy a house is now. You have a good income to afford the loan payments and you will have time to enjoy your home for the next ten or so years while you repay the home loan. Now, what are the next steps to take?

Get To Know Different Home Loan Options

The most common home loans are home purchase loans, offered and used for purchasing a new home. But there are also other options that may be good to analyze:

Home construction loans are used for constructing a new home, these are suitable if you already own the land. In the other hand, there are also land purchase loans, that are a good choice if you want to start for buying the land first and constructing later or purchasing a mobile home.

If you already own a home and had purchased it whit a home loan, and now you would like to move to another home that will also need extra finance, you could resort to a home conversion loan. In these kinds of loans, the actual loan is placed into the new home, including the extra amount required.

Choose A Lender

Define how much would you be willing to pay, based on how much would you be able to pay. Be honest to yourself at this point, remember that you will still have to live while you afford your new house's expenses. Sometimes the things that we can really get are not exactly the same as those we dreamed of. But, having sense on this, can help us avoid getting into a big debt that could ruin our plans if we cannot afford the home loan expenses after a few months.

Visit your bank, shop around your neighborhood, ask your friends or relatives, or just search for a lender on the Internet. However you decide to look for your lender, take your time to do all the questions you may have. Get to know all the terms and conditions from different lenders and the options they offer to you.

Make sure to also get to known all the eligibility requirements and which ones do you fulfill, before applying, these will give you the chance to improve your eligibility or to avoid being rejected if the lender has many conditions.

The most important, make sure you have found yourself a good deal and that you will be able to accomplish it, before signing the home loan papers.

Find YOUR Home

After the lender was chosen and the loan has been pre approved, the next thing to do is to decide of which kind of home do you want to be owner.

Once you have a good idea of how much would you be able to spend, start looking for your new home. Contacting real state agents is always a good place to start. It will be easier to find the ideal property, if you could also make a list of which features would you like to find in your new home. By combining both, your ideal price and what would you like to get, a real state agent will be able to select faster those properties that could suit your wishes best.

When you find THE home you want, make your offer and discuss the terms until getting to an agreement with the seller. Remember to get a home inspection before closing the deal. By doing this you could save a lot of money on mayor repairs that are not so obvious to your eyes.

If the home inspections goes fine, congratulations! you just have to close the deal and become a homeowner. If the home inspection does not goes as expected you can either decide to keep searching until you find another home or you can also modify your offer according to those needed repairs and close the deal anyway. If you decide to do this, be sure that those repairs will not cost you more money than you will be able to pay.

Whatever your decision may be, if you reached this point you are closer than ever to get your home. So, cheers to you!