In the decade following World War I, increasing numbers of North Americans experienced new prosperity and a spirit that anything was possible. In the Roaring ’20s, consumer spending increased, the stock market soared and a new phrase entered the lexicon: “buying on margin.” Meantime, a Colorado businessman focused on concepts altogether different. George S. Clason, who owned a successful mapmaking company, began writing about thriftiness and saving money to build wealth. Clason compiled his thoughts in pamphlets he printed and distributed through banks, investment houses and insurance companies starting in 1926.
After the stock market crash in 1929 and the onset of the Great Depression, Clason’s message had particular relevance, and he sought to bring his financial advice to an expanded readership. In 1930, he compiled his favorite stories as The Richest Man in Babylon and published them through his Clason Publishing Company.
The short, allegorical book struck a chord with Depression-era readers, who clamored for its easy-to-read financial advice and wisdom on building wealth. The book remained popular over the years, gaining exposure as new generations of financial success experts picked it up, learned from it and promoted it to more readers.
Today, The Richest Man in Babylon is considered a classic, having sold more than 2 million copies in 26 languages.
George Clason gained his financial wisdom through his own entrepreneurial endeavors. Born in Louisiana, Mo., in 1874, Clason attended the University of Nebraska and was a soldier in the Spanish-American War in 1898. In the early 1900s, he founded the Clason Map Company. In 1915 Clason published Free Homestead Lands of Colorado Described: A Handbook for Settlers, in the hope that interested people would move to Colorado, where his company was based.
As the 1920s economy began to boom, mass production made cars affordable, resulting in increased leisure time for Americans and greater demand for more highways. Clason recognized the opportunities, and in 1923, his map company published the first road atlas of the United States and Canada.
The thorough approach to mapping highways and an easy-to-read style earned the company a reputation for excellence. It would be another year before Clason’s competitor—Rand McNally—opened its doors. For nine years, the Clason Map Company published an annual updated atlas offering new features that made the maps even easier to use.
As he gained significant business experience through his map company, Clason saw another, more enduring, consumer need: building wealth. Through his writings, he aimed to guide others in handling their finances.
A New Vocation
Rather than writing in a dry business style, Clason delivered his lessons through parables set in ancient Babylon. The Richest Man in Babylon opens with friends Bansir and Kobbi reflecting on how much money they had earned during their lifetimes and how little they had to show for it. They decide to seek advice from their friend Arkad, the richest man in Babylon, whose wealth continued to grow even though he was generous to his family and charitable to others. What follows is a series of lessons, including “Seven Cures for a Lean Purse” and “The Five Laws of Gold.” These lessons address topics such as avoiding debt, seeking out mentors and protecting assets.
“Guard thy treasure from loss by investing only where thy principal is safe, where it may be reclaimed if desirable and where thou will not fail to collect a fair rental. Consult with wise men. Secure the advice of those experienced in the profitable handling of gold. Let their wisdom protect thy treasure from unsafe investments,”Clason writes in the chapter “Seven Cures for a Lean Purse.”
Following the success of The Richest Man in Babylon, Clason repackaged and reprinted the message under several titles, including Gold Ahead, Out of the Ruins of Babylon, Seven Remedies for a Lean Purse and Seven Keys to a Full Purse.
A Primer on Financial Success
In 1982, best-selling author and speaker Og Mandino included the classic book’s entire message in his own book, The University of Success. “This book has been acclaimed as the greatest of all inspirational works on the subject of thrift and financial planning,” Mandino wrote. “It can point you to a way of life that may have seemed beyond your reach.”
Jim Rohn, legendary entrepreneur and motivational speaker, also believed Clason’s book could serve as a key to financial success for those who applied its principles. Rohn’s early mentor, Earl Shoaff, introduced him to the book, which he credits for helping him become a millionaire by the age of 32.
Before live audiences and in his audio programs, Rohn spoke of the benefits of The Richest Man in Babylon. “I’ve recommended this book to over 4 million people over the past 40 years with the promise that [Clason] can help you create financial independence, and probably less than 10 percent have gone out to buy it,” Rohn said. “Don’t let that be you. Go out and find, buy and read this book.”
Another personal-achievement expert, Brian Tracy, explained in his book Getting Rich Your Own Way that Clason’s message, despite its age, is still valid today. “The book is a primer on financial success because its principles are simple, direct and effective,” Tracy says.
An Enduring Legacy
Clason applied the wealth-building lessons he learned in business to write The Richest Man in Babylon, and ultimately, the book paid off for him as well as his readers. He continued to live off the royalties after his map and publishing companies ceased operation, and he moved to Napa, Calif., where he died in 1957.
In an interview with The Denver Post during a 1952 trip to Denver for a speaking engagement, Clason indicated he was financially comfortable as a result of the book’s success. He said he had used the principles set forth in the book throughout his lifetime, “and now I don’t need to.”
More than a half-century after Clason’s death, his simple message of frugality and enterprise continues to inspire people to become better financial managers. Referenced in more than 100 books as a source of inspiration, clearly, Clason’s classic made lasting impact.
“The secret to personal financial success is believing and practicing this axiom: Part of all you earn is yours to keep,” Clason said in 1952. “Learn to live on less than you make and save the balance for yourself.”