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There is power in simple and obvious ideas.

The simple steps to wealth creation described in George S. Clason’s classic book, The Richest Man in Babylon, is an excellent example of this.

The Richest Man in Babylon uses “Seven Cures for a Lean Purse” to overview basic financial principles.

While Clayson wrote the book in 1926, the principles remain as relevant as ever.

Here are seven simple steps to wealth creation from The Richest Man in Babylon:

7 Cures for a Lean Purse

1. Pay yourself first using the skills you already have.

Pay yourself first. Whatever it is you do for a living, put 10% of your salary away into a savings account, and do not touch it.

And over time, that savings account will grow, bringing “satisfaction to thy soul.”

2. Keep your expenses low.

What each of us calls our ‘necessary expenses’ will always grow to equal our incomes unless we protest to the contrary…

Confuse not the necessary expenses with thy desires…

Study thoughtfully your accustomed habits of living.

Keep your expenses low. Take a hard look at what comes out of your bank account and see if there’s anything you can cut.

This will increase your savings rate and allow you to build wealth faster.

3. Invest what you save.

The money we may retain from our earnings is but the start.

The earnings it will make shall build our fortunes…

To put each coin to laboring that it may reproduce its kind…

a stream of wealth that shall flow constantly into your purse… an income that continueth to come whether you work or travel.

By investing in interest-generating assets, you’ll grow your wealth by compounding not only your initial investment but also all the interest the principal has generated previously.

4. Protect your investments from loss.

Don’t put your money at risk to get rich quickly.

Look for reputable money managers and investment vehicles to put your money into.

Slow and steady investing will get you rich over the long term.

5. Invest In A Home.

By purchasing a home, you are building equity in an asset instead of paying money to someone else for rent.

Also, homes generally appreciate in value over time.

So not only are you building equity, your equity will likely increase in value while you own the house.

6. Invest For Retirement.

The sooner you start compounding your money, the more money you’ll have to live off of when you choose to retire.

Investing in your pension or a tax-free retirement account will provide you with cash for you and your family to live off when you’re much older.

7. Learn New Skills To Increase Your Income.

The more of wisdom we know, the more we may earn. That man who seeks to learn more of his craft shall be richly rewarded

Always do the affairs of man change and improve because keen-minded men seek greater skill that they may better serve those upon whose patronage they depend.

Therefore, I urge all to be in the front rank of progress and not to stand still, lest they be left behind.

In the age of the internet, you can learn valuable skills almost for free.

As Naval Ravikant says:

Learning is a lifelong process. And the more you learn, the more income you can demand in a free market.

These 7 Steps Are Simple, But Not Easy.

It takes discipline to apply these seven simple steps to wealth creation.

But over a lifetime, they can make the difference between you having the freedom of your time or having to work for someone else as you get older.

Start now.

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Stay wealthy,

Wealth Operators