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7 habits of financially wise people

 

Whatever your financial situation, there are books telling you how to fix it -- get rich quick, get out of debt, make money without risk, avoid taxes, make higher than average returns on investing, etc.

Since the days of Benjamin Franklin and his book The Way to Wealth, financial self-help books have become like diet books: a hot item for a brief period then swiftly disappearing to the used book vendors.

Only a few books have withstood the test of time. One of those is The Intelligent Investor by Benjamin Graham in 1949. Another one is George Clason's The Richest Man in Babylon, compiled in the 1920s.

Clason used parables set in ancient Babylon, the place where money may have been invented. The parables are funny, familiar and include many insights about managing money. In one parable, Algamish tells Arkad the secret of his wealth in one sentence, "I found the road to wealth when I decided that a part of all I earned was mine to keep."

Arkad responds, "Is that all?"

Arkad reluctantly applies the wisdom and at Algamish's death Arkad becomes the richest man in Babylon giving that same advice to others, "Say to yourselves, 'A part of all I earn is mine to keep.' Say it in the morning. Say it at noon. Say it at night. Say it to yourself until the words stand out like letters of fire across the sky."

People often lose common sense when dealing with dollars and cents. The Richest Man in Babylon has endured for many years because Clason was able to put in a nutshell the basics of good financial planning in a handful of simple statements.

Taken together, they form a kind of "Seven Habits of Financially Wise People" …

1.  Start thy purse to fattening.
     (Keep at least a tenth of your earnings for yourself. Save.)

2.  Control thy expenditures.
      (Make a budget and stick to it.)

3.  Make thy gold multiply.
      (Invest wisely.)

4.  Guard thy treasures from loss by consulting with "wise men."
      (Get guidance from qualified financial professionals.)

5.  Make of thy dwelling a profitable investment.
      (Own your own home.)

6.  Insure a future income.
      (Have adequate life insurance and disability insurance. Make sure you will have adequate retirement income.)

7.  Increase thy ability to earn.
     (Continually improve your job skills to strengthen your value in the marketplace.) 


Don Spencer is Kentucky Baptist Convention Church Financial Benefits Consultant.

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