Hello everyone,
Welcome to another book review from my blog. In this post, I will examine the classic book, The Richest Man in Babylon, and explore whether it offers any valuable lessons for the current world of cryptocurrency.
The book was published in 1926 and written by George S. Clason. It was first written as a couple of scripts talking about finance, the importance of keeping something for yourself, and investing, as well as saving. Due to the book's age, there has been debate surrounding its relevance in the modern world.
Can lessons from this book still be applicable in a world of digital investing and digital currency? Of what use will keeping a share for yourself be to a crypto degen of today?
Even though the book's setting was Babylon, and all its stories talk about people who lived in Babylon, there are still lessons buried in the book that can be emulated by crypto traders and crypto enthusiasts.
Let's look at a few.
- Pay yourself first
If you grab a copy of the book, the first lesson is the act of paying yourself first. George, the author, makes a valid point in the book by explaining how a worker who gets paid their salary has nothing to keep for themself. Think about it. When that weekly or monthly paycheck comes in, how much of it is yours to keep? First, you pay off taxes, which go to the government. Next, you get a nice cloth for yourself, and that money goes to the tailor. You decide to take yourself to a nice restaurant, and that money goes to the owner of the restaurant. And when you are done, whatever is left is even lower than 10% of what you made.
Now take it into the crypto sector. How much of that profit you made is yours to keep. You made a $100 profit on a coin, but you have spent $80 on expenses, and now you have $20 left. Through George Clason, what he explains under the lesson of paying yourself first, is taking away 10% of whatever you make and saving it, or investing it.
Back to the $100 profit made from the coin you bought, with the knowledge of George Clason, you decide to take out $10 and save it up in HBD, then stake it for a 15% return. You have simply paid yourself because that money is always there for you. This is an example of what it means to pay yourself.
- Control your expenses
The next vital lesson from the book is the act of controlling your expenses. The book spoke about the mirage people get into, or the mistake people make of increasing their expenses when their income increases without a budget. Do not get it wrong in believing that you should remain poor when things get better, but look at it this way: how much of it can you avoid? If you were making $100 and your monthly expenses are $40, when you get a 10x increase in your monthly income to $1000, it makes more sense if your monthly income increases to $400 because of the increase in your income. As long as your expenses are not more than your income, you are fine, but it becomes alarming when it is way above the income or even 80% close to it.
Relating to crypto, it is quite understandable as humans to get carried away by the things we want, especially when we have made some pretty good returns on our token. But we forget that where there is a high, there will surely be a low, so you will be able to still avoid those expensive things when the lows or the bears come visiting. Hence, the importance of a budget to keep track of the expenses and adjust according to necessity and not conspicuous wants.
- Increase your ability to earn
This lesson talks about having multiple streams of income if you want that comfortable life you deserve. The book talks more about multiple trades and even uses stories to buttress its point for each chapter, which speaks more to this modern world than any other thing.
Taking into account the world of today, it is not really about having multiple trades but also about having multiple incomes, which can be digital. While investing in HBD or Hive by buying it in the open market, you can also write about things on your blog and get rewarded in Hive and HBD. There you have it, another ability to earn. Do not stop there, look for other financial instruments that offer reasonable returns and not get get-rich-quick scheme. You can know that from the outrageous returns they promise. For me, anything that is promising more than a 15% return per year deserves extra research to confirm its validity.
Look for more opportunities, for wealth can be accumulated even though one was not born with it, and do not underestimate the power of compound interest.
That is a wrap on this one.
Until next time in the next book.
Posted Using INLEO