The Power of Compounding

All you need to know from a personal finance perspective is that you need to compound your wealth.

Over a prolonged period of time, $2 becomes $4 becomes $8 becomes $16 becomes $32 becomes $64.

Conversely, owing to inflation, $2 becomes $1 becomes $0.50 becomes $0.25 becomes $.125. Might as well be zero really.

Yet the question from the more practically minded persons amongst us remains, how do you go about achieving this noble aim of compounding your wealth?

It is all and well and good saying that you wish to compound your wealth in this way, yet achieving this is something else altogether.

To this end, the Richest Man in Babylon is a concise storybook teaching the reader just that.

Going beyond saying a bird in hand is worth two in the bush, the book is a short story book, telling in parable form, the methods by which a man who lived a long, long time ago would have achieved this goal. It was achievable then and it is achievable now.

If you can get through the old language, the Richest Man in Babylon is a treasure trove of basic disciplines a person should exhibit if one were to try to achieve the aim of compounding one's wealth.

Whilst some of the suggested disciplines are more obvious, the others are not.

Not Personal Finance Advice

What do you think?

Have you read the fable and do you agree with what is being said?

Do you have trouble getting through the language of the book? Do you need to discuss the stories here?

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