The Richest Man in Babylon for Dentists

What can a dentist learn from the richest man in Babylon? Babylon was the most successful, wealthiest society to have ever existed. And it existed over 2,000 years ago, yet the principles of what made the man the wealthiest man in Babylon still applies to today.

Babylon was an amazing place because of where it even existed. Babylon was built on a desert. Usually, cities and settlements begin near sources of water, such as rivers, lakes, or oceans but in this case, it started in the middle of nowhere. It took collective human ingenuity and imagination to make a flourishing society come out of the ground.

This place was very special, especially, for over 2,000 years ago, for this was a place where arts and literature was respected, there was debate amongst intellectuals and, of course, successful entrepreneurs and business people all met in this area. And the richest man, this story is about the richest man in Babylon, Arkad. He was well known for being a rich and powerful man that was self-made. 

One day, he was walking into the store and a dusty bricklayer from a hard day of work mixed with sweat and cement all over his body and clothes, had the audacity to approach Arkad.  When he saw him and said, “Sir, can you teach me how you became so wealthy?” Arkad, by this time, was in his 70s. He was an old veteran of life and having not a son at that time to pass his lessons on to, took a little bit of an empathetic stance and took the time to explain some of life’s wealth building lessons. 

I’m going to summarize those lessons and curate them specifically for you as a busy professional. 

Living Within Your Means

These are the exact words, ‘Accumulate at the rate of one tenth.” So Arkad tells his story of getting rich from his poor days as a worker. He always tells himself, “You have to set aside one tenth of all the money you have earned.  Think about it every morning when you wake up, every afternoon before you eat, and even before you go to bed at night.  The amount set aside for yourself should not be less than one tenth of your total earnings and other expenses must be arranged reasonably, so as not to exceed the remaining amount. By saving at least 10% of your earnings and leaving it unspent, over time the amount will increase, and at that time, money will become your slave. It doesn’t matter how much money you start with as long as you follow the rule of paying yourself first from whatever you earn. By the time you get used to living on a certain percentage of your income, you won’t even notice this lack of savings and anyone who can, sooner or later, live on 80% or 90% of their income and enslave money, can become rich.’ 

Let’s dissect this, here he talks about money being slave and money going out and working for you. That’s a fundamental shift from what most people think about money.  Most people are taught to get a great education so that you can get a great job that will pay you. Here, it’s a complete shift. Let’s set aside money that will pay us instead. So, you should save at least 10% of your income and all of this comes down to responsible money management of your own income.  Learning to live slightly below your means and over time, expand your means. Now, if you can live off 50% of all earnings that you make, that means you can save 50% that can be used to pay you. 

Control Your Spending

Arkad says, ‘Even though different occupations have different amounts of money, some people, such as dentists or lawyers or doctors, can earn double or triple the income of some of their peers but why is it that everyone’s pocketbook is flat by the end of the day? Have you ever wondered about what we often call the “necessities” of life? Human desires are endless and we can only satisfy some of them for ourselves.  Consider making a list of your essentials, then pick a few essentials for life that fit your 9/10 of your income amount or 8/10, or if you’re even more aggressive, 5/10. Planning your expenses right now will help you meet your needs, enjoy the joys of life, fulfill your legitimate desires, and ensure a full life in your life, future.”

This is, I believe, the beginning where most people go wrong, including myself.  I did not have someone to teach me these principles.  Instead, I had to figure things out on my own.

Five Laws of Gold

Here are the concepts the richest man in Babylon, Arkad, taught Nomasir– the bricklayer. 

1. Gold Comes to Those Who Save

Pay yourself first!

2. Gold Proliferates with Those Who Know How to Invest

We’ve learned to accumulate the money by saving and paying ourselves first and afterwards, we need to learn to invest it in the right things that will actually accumulate. Well, investing could mean anything.  Investing could mean lending money to your nephew to start a barbershop, in stocks, buying cryptocurrency, buying real estate, taking a course to make yourself better; investing in yourself so that you can earn more money. 

3.  Gold Stays with Those Who Trust it to the Wise

You shouldn’t just invest in anything. Saving the money, that’s great, you did that, then you invest it in things that may or may not work, that also is a recipe for disaster. So gold stays with those who trust it to the wise. Meaning, seek advice, mentorship, not from people that are just talking about it, but from people that have actually done what you’re trying to do. 

In this story, Nomasir– the bricklayer, started saving money, then started investing in a cow milking business. He heard from a friend that the cow milking business was paying off tons in return.  He invested in that and it ended up being a scam and he lost it. Nomasir saved up again, and learned more lessons from Arkad.  One being, “seek counsel from wise men that have done it.”

Being in the bricklayer business and working with the masons that were building structures, he now invested in a mason business and it was something he understood. He knew the people were building it and were getting wealthy from selling. The rates of returns weren’t as high as the promised cow milking business, but he started to earn from his money. 

4.  Gold is Lost When You Invest in Things You Don’t Understand

Cryptocurrencies, stocks, options, sometimes we understand it and sometimes we don’t. Oftentimes we just do what our financial advisor tells us to do. Warren Buffett says this all the time; He doesn’t invest in things he doesn’t understand.

5. Gold is Lost Quickly Under Get Rich Quick Scheme

When Nomasir started to apply these rules of gold and studied and solidified the philosophy that was taught to him he learned without wisdom, gold is quickly lost to the one who has it. With wisdom, gold can be made from someone who does not have it.