If your existence isn’t producing more monetary value to others than you are receiving, then you’re helping whittle away wealth from the planet. And if the efforts of those Creating True Wealth don’t surpass the effects of those lapping up wealth like starving dogs, then economic depression isn’t far behind.
Where Does Wealth Come From?
Luckily, a lot of people like to work and are pretty good at their craft, which helps drive the economy. Simply put, wealth comes from financing work, in other words, spending money to purchase something that someone worked to produce.
If you pay someone to make something tangible for you, the act of them exerting their time and energy upon the raw materials to create the item actually increases wealth on the planet – for them and potentially for you too depending on the quality of their work. They get paid for their time and increase their wealth. In return you get something theoretically of equal or greater value. If the item is of greater value than it cost you, then you have profited from your investment and further increased your wealth as well. Nice, huh! Others third parties may benefit too.
George S. Clason describes the principle nicely in his book The Richest Man In Babylon:
“Wealth grows wherever men exert energy…If a rich man builds him a new palace, is the gold he pays out gone? No, the brickmaker has part of it and the laborer has part of it, and the artist has part of it. And everyone who labors upon the house has part of it. Yet when the palace is completed, is it not worth all it cost? And is the ground upon which it stands not worth more because it is there? And is the ground that adjoins it not worth more because it is there?”
Building one house may not make anyone wealthy, though. In fact, a stream of house building producing a steady income, alone, won’t do it either.
The Discipline of Saving
A portion of your income must be saved for your purse to fatten. “But when I began to take out from my purse but nine parts of ten I put in, it began to fatten. So will thine.” In other words, “pay yourself” by keeping a minimum of 10% of your earnings for saving and investing.
Again, Clason makes a great point: “Which desirest thou the most? Is it the gratification of thy desires of each day, a jewel, a bit of finery, better raiment, more food; things quickly gone and forgotten? Or is it substantial belongings, gold, lands, herds, merchandise, income-bringing investments? The coins thou takest from thy purse bring the first. The coins thou leavest within it will bring the latter.”
Discipline is Spelled BUDGET
“The purpose of a budget is to help thy purse to fatten…It is to enable thee to realize thy most cherished desires by defending them from thy casual wishes.” Don’t you love how that is said!
Evaluate your expenses to determine what is really necessary, considering “That what each of us calls our ‘necessary expenses’ will always grow to equal our incomes unless we protest to the contrary.”
How Much of Getting Wealthy is Luck?
Becoming wealthy is not due to luck. But don’t pass up opportunity. Act immediately if the price is good. “Good luck” follows opportunity. “So must every man master his own spirit of procrastination before he can expect to share in the rich treasures of Babylon.”
Other Things to Keep in Mind While Growing Wealth
Assess risk before investing in anything. Consult those experienced in handling money. Get advice from experts.
“If you desire to help thy friend, do so in a way that will not bring thy friend’s burdens upon thyself.”
Protect your money. Safe, small returns are better than risky ventures. Principle must be safe and available.
Don’t force money to impossible earnings. If it seems too good to be true it probably is.
“Easy money” and “get rich quick” schemes don’t create wealth (they might make an individual richer, but it’s usually due to someone else’s loss).
Your desires must be simple and definite. Don’t have unrealistic or overly-complicated goals.
As your 10% grows and multiplies, consider buying houses and other property. Diversify your investments.
Own your dwelling, and buy it out of the 90% left after you pay yourself.
Plan for income in old age. Your investments should produce income.
In Summary, Create Wealth by Doing the Following:
Save at least 10% with discipline.
Use a budget to make your money behave.
Look for opportunities.
Seek advice from experts, read, get second and third opinions.
All Quotes from, The Richest Man In Babylon, George S. Clason