# Richest Man in Babylon



## KingsX (May 24, 2018)

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"The Richest Man in Babylon" is a simple classic book that teaches fundamentals of acquiring wealth.

In the book,  a rich man instructs a poor man on how to become rich.


The rich man taught:

" Behold, from my humble earnings I had begotten a hoard of golden slaves, each laboring and earning more gold. As they labored for me, so their children also labored and their children's children until great was the income from their combined efforts. "


But as soon as the poor man saved some money,  he recklessly spent it.

" I do have a great feast with honey and fine wine and spiced cake. Also I have bought me a scarlet tunic. And some day I shall buy me a young ass upon which to ride."


The rich man responds:

"You do eat the children of your savings. Then how do you expect them to work for you? And how can they have children that will also work for you?  First get thee an army of golden slaves and then many a rich banquet may you enjoy without regret."

*

"I tell you, my students, a man's wealth is not in the coins he carries in his purse; it is the income he buildeth, the golden stream that continually floweth into his purse and keepeth it always bulging. That is what every man desireth. That is what thou, each one of thee desireth; an income that continueth to come whether thou work or travel. "

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## Aunt Bea (May 24, 2018)

“Wealth, like a tree, grows from a tiny seed. The first copper you save is the seed from which your tree of wealth shall grow. The sooner you plant that seed the sooner shall the tree grow. And the more faithfully you nourish and water that tree with consistent savings, the sooner may you bask in contentment beneath its shade.” - George S. Clason


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## Aunt Bea (May 24, 2018)

“A part of all I earn is mine to keep.' Say it in the morning when you first arise. Say it at noon. Say it at night. Say it each hour of every day. Say it to yourself until the words stand out like letters of fire across the sky.”  - George S. Clason


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## hearlady (May 24, 2018)

Penny saved is a penny earned. That's all I got.


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## KingsX (May 24, 2018)

hearlady said:


> Penny saved is a penny earned. That's all I got.




A penny saved is more than a penny earned when the penny earned is taxed.

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## mathjak107 (May 24, 2018)

hearlady said:


> Penny saved is a penny earned. That's all I got.


except without good compounding it is always a penny. actually less after inflation and taxes


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## KingsX (May 24, 2018)

KingsX said:


> A penny saved is more than a penny earned when the penny earned is taxed.
> 
> .




This is why it is usually better to own than rent, especially in retirement.

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## mathjak107 (May 24, 2018)

that can be very debatable because most of us tend not to rent as much house as we would buy .

a renter who leaves a 3 bedroom apartment after raising a family and takes a 1 bedroom apartment can see far greater savings and cash flow than someone still paying to keep a big house going with many thousands of dollars in taxes and upkeep .

we actually do better renting .   we were debating buying a co-op instead of renting . buying is 6k less than our rent but we will give up 12k in income on the money now tied up in the co-op . so we are 6k a head renting.

each situation and location will be unique and there is no real rule about buying being cheaper .

in our area if i was to buy a house a starter home is over a million dollars , but we rent a nice 2 bedroom 2 bath apartment in a luxury building with pool and tennis courts for a fraction of what a home would cost us to own


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## KingsX (May 24, 2018)

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I was putting "buy versus rent"  in the context of when a penny earned is taxed.

If one buys a reasonably priced house in a good area and pays it off before he retires, 
he can live there cheaper than rent while the house has appreciated tax free.

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## KingsX (May 24, 2018)

mathjak107 said:


> in our area if i was to buy a house a startet home is over a million dollars , but we rent a nice 2 bedroom 2 bath apartment in a luxury building with pool and tennis courts for a fraction of what a home would cost us to own




Real estate in many areas of the two extreme coasts has become quite expensive and out of reach for the average American.

But that is not true of most of the rest of the country.

In 2001,  I paid $135,000 for my 2222 sq ft,  4 bedroom,  2 1/2 bath brick house in a very nice neighborhood in suburban Dallas County.

Houses in my neighborhood are now selling for well over $200,000.  If I sold at a profit,  it would be tax-free.

Because my house is paid off,  I can live here much cheaper than paying rent on an apartment less than half the size of my house... and the apartment would have no garage... my double garage with a door that leads directly into my kitchen nook is one of my favorite parts of my house.

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## mathjak107 (May 24, 2018)

we did the opposite . we rented the last 15 years except for a 2nd home which we sold .

the money not tied up in a house let us buy into a very lucrative real estate partnership . that money easily can buy many homes today . so there are so many variables to which is better . the important thing is if you rent invest in other more lucrative assets .

owning can be a nice cost cutter in some areas . so while it does not increase income the cost cutting improves cash flow .


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## JaniceM (May 24, 2018)

Aunt Bea said:


> “*A part of all I earn is mine to keep.'* Say it in the morning when you first arise. Say it at noon. Say it at night. Say it each hour of every day. Say it to yourself until the words stand out like letters of fire across the sky.”  - George S. Clason



..and all the rest goes to the IRS  layful:


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## Aunt Bea (May 25, 2018)

JaniceM said:


> ..and all the rest goes to the IRS  layful:




* "A person doesn't know how much he has to be thankful for until he has to pay taxes on it."*


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## mathjak107 (May 25, 2018)

or until it is gone


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## Aunt Bea (May 25, 2018)

mathjak107 said:


> or until it is gone



*“When the well is dry, we know the worth of water.”― Ben Franklin*


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## KingsX (May 25, 2018)

Aunt Bea said:


> *
> 
> "A person doesn't know how much he has to be thankful for until he has to pay taxes on it."*




Speaking of that... the weirdest state or local tax is a "personal property" tax.
Some people have to pay a tax annually on their cars, furniture, jewelry, etc.
What's up with that ??  [I've never lived in a place where i had to pay it.]

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## Knight (May 25, 2018)

KingsX said:


> .
> 
> 
> "The Richest Man in Babylon" is a simple classic book that teaches fundamentals of acquiring wealth.
> ...



How times have changed. Instead of begetting a hoard of golden slaves, one dependent living in the basement living off what the parents might have managed to save is happening. Recently a court case of parents wanting the court to evict their 30 yr. old son might be an example.


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## Aunt Bea (May 25, 2018)

KingsX said:


> Speaking of that... the weirdest state or local tax is a "personal property" tax.
> Some people have to pay a tax annually on their cars, furniture, jewelry, etc.
> What's up with that ?? [I've never lived in a place where i had to pay it.].



The government would end up owing me money!!!layful:


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## mathjak107 (May 26, 2018)

KingsX said:


> Real estate in many areas of the two extreme coasts has become quite expensive and out of reach for the average American.
> 
> But that is not true of most of the rest of the country.
> 
> ...




real estate is very localized , even the same city can see a world of difference .

our house we bought in 1987 was 169k in queens nyc .  today that house is 950K . it sounds great except 169k in the fidelity insight growth model i have followed since 1987 took the same 169k and would have grown it to close to 4 million today.even  the s&p 500 would be 3.5 million . 

so you could actually have rented and paid all the taxes , subtracted them out and bought two homes with the money  today  not just one . so renting today and rent increases are really not an issue because you have so much more .

on the other hand one of the co-ops we own in kew gardens in nyc went from 77k in 1987  to 190k today . rent went from 850 to 1900 today .  not so good in comparison to the house .

but then our manhattan real estate soared and over just 15 years beat the pants off everything , but that was not based on just appreciation . it was based on the art of the deal and the very low buy price negotiated because  these were rent stabilized apartments that were co-ops with stabilized original tenants . we paid each tenant 100k to move and out of 9 apartments 7 took the offer and we sold the apartments for 7 figures .

so real estate like stocks can be quite variable as to results .  

 for non investors owning in a low cost area can be beneficial 

for those who prefer investing , renting and investing can be the better choice in a high cost area . .


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## KingsX (May 26, 2018)

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When/where I grew up, one either owned a house or rented a house. There were no apartment buildings. 

Uniform institutional looking apartment buildings remind me of the USSR.

Not only does one have less privacy and independence living in an big apartment complex,  one is also exposed to more crime.  

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## mathjak107 (May 26, 2018)

ell we live in a great area with zero crime in our building . it is a gated complex with a security booth so we are pretty happy here. so much so my wife is here 35 years .  we married and i moved in to her apartment selling my house .

we have zero chores , zero maintenance and zero  surprise repairs .   i love that!


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## Aunt Bea (May 26, 2018)

KingsX said:


> .
> 
> When/where I grew up, one either owned a house or rented a house. There were no apartment buildings.
> 
> ...



I've never found that to be true.

In all of my 64 years of renting and owning, I'm the only one that was ever responsible for bringing trouble of any kind to my door.


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## KingsX (May 26, 2018)

Aunt Bea said:


> I've never found that to be true.
> 
> In all of my 64 years of renting and owning, I'm the only one that was ever responsible for bringing trouble of any kind to my door.




You sound like a savvy, responsible person... and you have been blessed.

I have been blessed too... but I am aware.

There is good reason single women are advised not to live in a first floor apartment.
But that doesn't prevent single women in second floor apartments being crime victims.
In one case I know the woman didn't realize she was being stalked by a neighbor until
she came to her door and he forced her inside, raped and murdered her. It happens
more times than many realize. 

My social worker friend [who lives in a house]  was sitting in her car writing notes while
she waited for her next appointment.  It was the middle of the day and she was parked
in a big supermarket parking lot in a good neighborhood when she was attacked by a man
who reached into her car window to grab her purse.  In the process he hurt her arm and
it took quite some time and physical therapy for her arm to recover.

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