Make Thy Home a Profitable Investment- Lesson 5

Buying a Home is a Big Decision

George Clason is using Arkad to teach the value and potential profitability of home ownership.  Without question, buying a home is a big decision.  And, for most people, it is the largest investment they will make in their lifetime.  The expenses associated with home ownership are significant too.  However, Clason believes that buying the right house can improve the quality of life for most families. 1

In lesson five, Arkad said, “No man’s family can fully enjoy life unless they do have a plot of ground wherein children can play in the clean earth and where the wife may raise not only blossoms but good rich herbs to feed her family.” 2

Buy What You Can Afford

The main point Clason is making is that to be a successful homeowner we should buy only as much house as we can afford.  We must live below our means, be realistic about our expectations, and carefully study all of the options relating to the current real estate market.  It is imperative to seek advice from experts and friends during the process.  

Renting vs. Buying

The fact is that many people chose to rent a home or an apartment before buying a home.  That’s okay because whether you are looking for something to rent or buy, the same amount of planning, risk assessment, budget constraints and family needs apply to both options.

It Boils Down to Personal Preference

The age-old question remains today, should you buy or rent?  The truth of the matter is that it boils down to personal preference and one real estate professional recently said, “The way you’ll feel about buying versus renting is very much in the eye of the beholder.”  [By Paula Pant, WiserAdvisor contributor]

Keeping a Roof Over Your Head

The argument that if you rent, you are “throwing money away” is still made today.  Whether you are renting or buying, your household expenses add up to one thing, keeping a roof over your head.  So, whether you rent or buy, you are paying money for a desired good or service.  Consequently, the decision is yours.

Enjoying a Home That Is Purely Yours

In the long run, Clason makes a case for homeownership as the best alternative to having a roof over your head.  When you buy the right house, at the right price, with a total expense level that, by today’s standards, does not exceed 25% of your total household income, owning a home will “give you more money to spend on the pleasures of life.”  In other words, one of the biggest benefits to homeownership is, “You’ll enjoy a home that’s purely yours.”  [By Paula Pant, WiserAdvisor contributor]

Lesson Six- The Magic of “Compounding Interest.”

In Lesson Six George Clason emphasizes the importance of developing a plan for your retirement. The younger you are when you begin setting aside money, the more you will accumulate for your retirement years. In this lesson, Clason introduces what many have called the “Eighth Wonder of the World,  the magic of compounding interest.”  Don’t wait.  Please go to Lesson six now.

###Larry Marvin
LifeCrafter – Money $ense

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  2. The Seven (7) Cures For A Lean Purse –,

Make Thy Gold Multiply

Now that you are controlling your expenses and continuing to set aside 10% to pay yourself, it is time to put your 10% to work.  The discipline we have learned by controlling our expenses and paying ourselves 10% of our earnings is a major factor in the wealth building process. Because it is the gains on the 10%, that will ultimately build your fortune.   1

Establish An Emergency Fund

I believe that before we begin investing that we create an Emergency Fund.  An Emergency Fund has two components.  The first is to build the fund to $1,000.00 to cover the unexpected expenses that arise outside of your budget.  And you should do this as soon as possible.  The next component is to grow the fund to have three to six months worth of your living expenses as defined by your budget.  Once your savings account has grown to that level, then, and only then should you begin investing in other types of wealth building methods.

Your Wealth Grows by the Magic of Compound Interest

Your emergency fund should be left untouched as you explore and consider other investment plans to begin multiplying your money.  Wealth increases by making wise investments over the years, and consistent growth realized through the magic of compound interest.

Invest In Only Things You Know

Here is a crucial principle, invest in only “things” you know.  There are many investment options available but to invest in anything that you do not have a knowledge of could be a mistake.  There are stocks, bonds, commodities, annuities, mutual funds, certificates of deposit (CD’s) and the list goes on.  We should not invest in anything we do not completely understand.  Also, we have to figure out that there are no “fool proof” investment options, and there must be a complete understanding of what can go wrong and how you can get your money back should the investment opportunity go South.

Don’t Put All of Your Eggs in One Basket

One of the key points to minimizing the risks is to diversify by placing your investment funds into many different areas.  Diversification is a term that means don’t put all of your eggs in one basket.  Diversification can minimize the losses associated with the ups and downs of the marketplace.

Compounding Interest the Key to Building Wealth

Remember the “rate of return” on each investment is essential to the wealth building process.  Invest your money in ways that will ensure your investments will multiply by taking advantage of the compounding interest we earn from our investments.  Compounding interest is the key to making our wealth multiply.

Earnings on Investments Grows Wealth

Arkad said, “The gold we may retain from our earnings is but the start.  The earnings it will make shall build our fortunes.”  So the third lesson teaches us to put our money to work so that it may produce a “stream of wealth that shall continuously flow into thy purse.”

In Lesson 4 Clason teaches us how to guard our “treasures against loss.”  It entails the importance of protecting your money from loss by seeking wise counsel and using their wisdom to protect yourself from unwise investments.  Go to the blog post entitled “Guard Thy Treasures From Loss.”

### Larry Marvin
LifeCrafter – Money $ense

  1.  ©2016 Larry Marvin, Image Credit:https://

Guard Thy Treasures From Loss

George Clason uses Arkad, one of the main characters of his book The Richest Man in Babylon to continue the discussion about the cures for a lean purse. In lesson four,  Arkad tells the men who have gathered to listen “the first sound principle of investment is security for thy principal.”  1  

Know the Risks Before You Invest

Arkad explains that the temptation to invest in opportunities that have large earnings potential may be hard to pass up but, he said, “the penalty of risk is probable loss.”  Any knowledgeable investment advisor will tell you that risk and return are important considerations for every investment.  The more risk you take can mean a higher return on your investment, while less risk will mean lower returns but greater safety.  So no matter what investment option you choose, make sure you know the risks before you invest.

Always Seek Counsel From Experts

You should only invest in things that you know and understand. Ask yourself “what is my objective for this investment?”  Don’t rely on your knowledge but seek counsel from experts in the area of the investment you are considering.  Let the wisdom of “others” experienced in investing guide you.  They can help protect your treasure from risky investments.

There Are Risks With Every Investment

Whether you make money or not on your investments depends on how well your investments perform. There are risks with any investment but having a good understanding of each investment and the risks involved significantly increases your chances of picking profitable investments.

Avoid “Get Rich Quick” Schemes

Arkad admonishes his audience to careful study and research to ensure, as much as possible, that you will get your investment back.  He stresses the importance of investing only in things you know and do not invest in “get rich quick” schemes.

Personal Loans to Others Are Risky

And finally, in this lesson, Arkad briefly discusses a principle regarding the loaning of your money to other people.  It is very simple, if you make a loan to someone,  make sure they have the ability to pay you back and the reputation for handling their money well.

Please join us for lesson five as George Clason, through Arkad, the Richest Man in Babylon, teaches us how to make our house a profitable investment. 

###Larry Marvin
LifeCrafter – Money $ense


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Controlling Your Expenses

In lesson two, George Clason describes the second skill that is necessary to build a firm foundation to becoming the wealthiest person possible. The first is to  “pay yourselves first,” and the second involves “controlling your expenses,” or in other words, learn how to live below your means.  1 2

Advice on Spending the 90%

After paying ourselves the first 10% of our earnings we live on the other 90%.  We must now make the best use of our money possible which means we must control the money we spend on everything else.  Clason gives us some advice as it relates to spending the 90%.

Needs vs. Wants

Needs vs. Wants
Needs vs. Wants

We have to define the difference between “needs” and “wants.”  If we are not careful, what we all call necessary expenses will always grow to equal incomes unless we clearly understand this concept.  The key is to study your lifestyle and reduce costs or eliminate them totally if possible.  We should reduce our expenses to a level of needs only and live only on the 90% and do not touch not the 10%. 

Make a Budget

Make a budget and write down all of your expenses.  Dave Ramsey says, “A budget lets you decide what is worth spending your money on.”   If you want to “fatten your purse,” you must establish a budget.  

Budgets Show Where Your Money is Going

A budget will help you to take control of your money by identifying how you have spent money in the past, and will keep your money from going where you don’t want it to go in the future. Your budget will help tell you exactly where the money goes, will enable you to pay your necessary expenses, and to pay for wants without exceeding 90%, leaving the 10% to grow your wealth.

Learning to Earn More Money is Our Best Offense

Our best offense, to use a football analogy, is our ability to earn money.  Growing our wealth by using a budget to control our spending then, is the defense we have in building our wealth.

A Budget Will Help Identify Misspending

Budgets will help you identify the leaks in your purse.  Manage your expenses to have money to pay for your necessary expenses, to pay for wants without exceeding 90%,  leaving the 10% to grow.

Lesson 3 Teaches How to Make Your Money Grow

In Lesson 3, “Make Thy Gold Multiply,”  Clason discusses building our 10% by the magic of compound interest and sound investing principles.

### Larry Marvin
LifeCrafter – Money $ense

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The First Lesson in Becoming Wealthy

The First of Seven Skills Needed to Become Rich

In the third chapter of George Clason’s book, The Richest Man In Babylon, he describes the skills that are necessary to build a firm foundation to becoming the wealthiest person possible. The first of the seven lessons Clason describes is to  “pay yourselves first.” 1 

The Road to Wealth

When Bansir and Kobbi sought the advice of their wealthy friend Arkad, he tells them the advice a rich man gave him years ago. The rich man told Arkad “I found the road to wealth,” he said, “When I decided that a part of all I earned was mine to keep.” 2

Arkad’s Powerful Message in Becoming Wealthy

The message he gave Arkad is simple but powerful in becoming wealthy.   To accumulate money, we have to save a portion of what we earn by paying ourselves first before spending money on anything else.

Learn to Live on What You Earn

To begin with, we have to learn how to live on our existing income and become the best employee and business owner possible.  We should pay ourselves first with our money by saving 10% of all that we earn and much more as we can afford to do so.

The First 10% Is Yours

For every dollar that we earn, 10 cents should be set aside for the person you see in the mirror every morning. Knowing this first rule and living by it is one of the important principles that distinguishes the rich from the poor. The financially stable people know this rule and live by it and the poor do not.

Learn to Live on the 90%

And then we must learn how to live on the 90% that remains.  If you are an excellent employee or have a successful business, your “purse” will grow over time.

In lesson 2, Clason’s topic is, “control thy expenditures” or in other words, live below your means.  


Larry Marvin
LifeCrafter – Money $ense

2.  What You Can Learn From The Richest Man In Babylon, (accessed June 21, 2016).

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The Man Who Desired Gold

In chapter one, Clason tells the reader that to bring your dreams and desires to fulfillment, you must be successful with money.  That the laws of money are like the laws of gravity: assured and unchanging; and that money is plentiful for those who understand the simple laws of making money.  1

Worked Hard and Nothing to Show For It

Bansir the chariot builder and Kobbi a musician were typical workers who came to the realization that they had worked all of their lives but had nothing to show for it. The two had become the best at their craft but yet had no money and were poor.  How many of us can identify with these men today? Recalling their days as young men, Bansir and Kobbi touched on their experiences with money.

All Talk and Wishful Thinking

They both had hoped that one day, prosperity would be bestowed upon them.  They had earned so much gold over the years but were coming to the realization that such a blessing was not imminent, often planning and scheming that their families didn’t go hungry.  They worked hard to provide for their families but did all that they had done to this point was merely talk and wishful thinking.

To Find Wealth You Must Seek It

Bansir and Kobbi have the same problem; they do not know how to alter their stations in life when they make a fixed income and must care for their families from that amount.  It’s simple to say, but many people never achieve a serious measure of wealth because they never seek it. They never truly seek it, focus on it, and commit to it.

Seek Advice From Knowledgeable Experts

But Bansir is wise enough to seek the advice of a friend who has achieved the exact thing to which they both aspire. They remembered a friend, Arkad, who they had schooled with who was ‘blessed with prosperity’, and the city claimed to be ‘The Richest Man In Babylon’. They decided to consult Arkad.

Arkad willingly tells them the secret of his success although he tells the men that his advice alone is not enough to make them wealthy. They will all have to learn how to apply the advice if they are to have enough to live the type of life each one desires.

All People Have Dreams

The lessons that Arkad provided for his friends are lessons of wealth building habits that no doubt every rich person has followed to accumulate their wealth.  Even today with Facebook, Google, Twitter, SnapChat and many other means  of technology, human nature has not changed.  Whether living in the age of the camel or computer,  people have dreams for the future and want to change their status in life.

The Rules for Success Are Ageless

The rules for successful living are the same today and they were for Bansir and Kobbi.  So the lessons in Clason’s book have helped many people become financially stable and wealthy. Lessons that will help most anyone to build a firm financial foundation on the way to becoming the wealthiest person that each can become but only if they are willing to initiate the effort and discipline it will take to be successful.  

You Must Understand the Laws of Making Money

Money is plentiful for those who understand the simple laws of making money.  It is not good enough to “desire gold”, you must take the action necessary to achieve the success you desire.

### Larry Marvin
LifeCrafter – Money $ense



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The Richest Man in Babylon Introduction

Richest man in Babylon

What do you do when there’s more month than money? When there are more bills to be paid, but the checking account is at (or below) zero?  When you don’t feel like the richest man? When there are more groceries to be bought? Or the time when your budget was looking good, but then the car needed a new water pump, and things all started to fall apart? 1

Financial Principles Are Universal

Like the law of gravity, financial principles are universal and unchanging.  As you travel down the road of life, your ambition and desires seem to be thwarted by the shortage of money, the method by which earthly success is measured.

Most People Have Financial Struggles

You are not all alone in this struggle.   It is not much fun being financially uncomfortable and having to worry about making ends meet day after day; week after week; and month after month.  The fact is that if you want to bring your dreams and desires to fulfillment, you must know how to be successful with money.

George S. Clason wrote the book “The Richest Man in Babylon” which dispenses financial advice through a collection of parables set in ancient Babylon. Through their experiences in business and managing household finance, the characters in the parables learn simple lessons in financial wisdom. Originally a series of separate informational pamphlets distributed by banks and insurance companies, the pamphlets were bound together and published in book form by Clason in 1926.

Clason Uses Stories to Teach Financial Principles

There are many things we can learn on our own and should strive to make ourselves well-rounded.  Clason takes a creative, yet simple story-telling approach teaching the reader the basics and the foundation of how to conservatively build wealth over time and become financially successful.

Ancient Babylon Is the Setting

The story takes place in Babylon some 6,000 years ago where the significance of financial wealth, gold, in this case, was very important. Today, we live in a society that only seems to put more and more importance on money. I hope that you are driven and motivated by your own definitions of success, but our culture as a whole still has a long way to go to eat healthier, enhance our current work skills, or learn to make more money, we must take the initiative to invest in ourselves.   When we become smarter and wiser our ability to earn more also increases.

Using Clason’s Richest Man Lessons Can End Financial Worries

Perhaps our country wouldn’t be where it is today if we had all heeded the lessons of fundamental personal finance and investment that George Clason laid out for us almost 100 years ago.  If used today, these timeless principles can help guide you away from the rut you are in and enable you to start to take control of your finances and create better long-term financial habits to put an end to your money worries.

Do not wait.  Go to part one of the series entitled “The Man Who Desired Gold.”

### Larry Marvin
LifeCrafter – Money $ense

  1.  ©2016 Larry Marvin, Image Credit:

Teenagers Everywhere Don’t Understand Money

You’re living in Zedland. Which is a better deal at the local market, loose tomatoes for 2.75 zeds per kilogram, or 22 zeds for a 10-kg box? Before you answer, rest assured that there is no Zedland and no currency called the zed. The test question is part of a multinational assessment of the financial literacy of 15-year-olds. They didn’t do well.

It turns out that most young people aren’t ready to be in charge of their own money. Only 12 percent scored at the highest level of financial literacy, and 22 percent “score below the baseline level of proficiency,” according to the Organization for Economic Cooperation & Development, which runs the Program for International Student Assessment, better known as PISA. The study results were released May 24. Students at the lowest level of financial literacy “cannot even recognize the value of a simple budget or understand the relationship between how much a vehicle is used and the costs incurred,” Angel Gurria, the secretary-general of the OECD, wrote in the preface of the report.

Teenagers in the U.S. finished just above the middle of the pack. But international comparisons are difficult because in some countries only a relatively well-educated segment of the population took the test. In China, whose students scored highest, the test was administered in Beijing, Shanghai, Jiangsu, and Guangdong. Second was the Flemish Community of Belgium, followed by the participating Canadian provinces (British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, and Prince Edward Island), Russia, the Netherlands, and Australia. Parents didn’t need Gurria to tell them that 15-year-olds are clueless about financial matters.

One interesting finding is that about 38 percent of the performance on the financial literacy test cannot be explained by a student’s ability in math and reading. Which means your young one can do just fine in algebra and geometry and still mess up personal decisions involving, say, how to use a prepaid debit card. Another finding was that 56 percent of students have a bank account but two out of three don’t have the skills to manage it and can’t interpret a bank statement. The answer to the tomato question, of course, is that the price per kilogram is lower for the box than for loose tomatoes. But that assumes you really need 10 kilograms—22 pounds—of tomatoes. A follow-up question does ask why “buying a box of tomatoes may be a bad financial decision for some people.” Students got full credit for saying the tomatoes might rot before you used them all, but no credit if they wrote, “Some people don’t like tomatoes.” Here’s a link to more questions, in case you want to find out if you’re smarter than a 15-year-old.

Who are Better Investors: Men or Women? Part Two.

Better Investor Wall Street Bull

The battle of the sexes has long been a familiar theme when it comes to who are the better investors. But current trends show that women and men’s investing habits are getting closer.1

90% of Women Manage Their Own Finances

In part one of our program, I stated that 90% of women will have to manage their personal finances on their own at some point in their life and that is why it is imperative for women to develop a solid understanding of how to manage their money which includes being better investors.

Men Are More Trigger Happy

I also stated that men tend to be more “trigger-happy” and generally take more risk.  Men may also show more overconfidence than women in investing. Overconfidence can lead men to take on too much risk and invest in companies they really don’t know.

So, what exactly can men learn from women when it comes to being better investors?

Men Are Overconfident

Men have a tendency to believe their interpretations of news and market movements is sound and feel they can make profitable trading decisions, but this isn’t as true as they may think.

By contrast, women are more likely to recognize and acknowledge when they don’t know something. If they don’t feel they know a company well enough to invest in it, they do more research or wait for a more suitable investment.

Men Trade More Than Women

Men trade 45 percent more than women.2 Research found that men trade more excessively than women, which can be attributed to overconfidence which leads to lower returns.3

Most of the time the negative impact on returns is because of the fees an investor pays when trades are made in a person’s investment portfolio. More trades means higher fees which lower the total return in the investment account.

More Trades Lowers Returns

Generally speaking, men seem to have the need to monitor investments on a daily basis and reacting on short-term fluctuations in stock market performance most often leads to negative outcomes.

Women Are More Patient

Women being better investors

In general, women may be better investors because they have more patience when it comes to investing, which can be a benefit over the long term. “Women are more likely to give their investments time to grow. This is important because checking returns and acting on short-term fluctuations in stock performance leads to negative outcomes,” Sussman says.

Men Need More Patience

Consequently, Sussman believes that men could borrow a page from the patience playbook as there may be no need to monitor retirement investments on a daily basis.

So, I must conclude that women are really more capable than they give themselves credit for. They are better investors in the stock market because they are more likely to recognize and acknowledge when they don’t know something, will do the necessary research to determine if the investment is good or bad.

And, most importantly, women have the patience to ride out the ups and downs of today’s volatile markets and more likely to give their investments time to grow.

Gender Really Doesn’t Matter for Better Investors

This debate is going to rage on for years to come. At the end of the day, gender doesn’t really make a difference. The best investors will be the ones who get the fundamentals down from the start.

I would like to thank you for your interest in our educational programs and materials. Please go to for additional help with your financial needs.

### Larry Marvin
LifeCrafter – Money $ense

  1.  ©2016 Larry Marvin, Image Credit: Charging Bull by Sam Valadi CC flickr 22JUL2011
  2.  According to Abigail Sussman, an assistant professor at The University of Chicago Booth School of Business.
  3. Supra.

One Step to a Better Marriage – Keeping a Confidence

better marriage keep confidences

One thing you can do to have a better marriage is to make your marriage a safe place to share. Agree with one another that whatever you share with each other will be kept confidential unless your spouse gives you express permission to share it. Confidentiality in marriage builds confidence in your marriage relationship.1

DO THIS: Say to your spouse, “I will not repeat anything you tell me without your permission.”

One of the biggest threats to a marriage is the little tongue. Repeating what your spouse shared with you in confidence or in a moment of intimacy rips the fabric of the marriage relationship and that rip takes months of trust building to repair – if it can be repaired at all.

Easy to Rationalize

It is easy to rationalize talking to a trusted friend or family member about the details of your marriage for advice to “make it better.” The fact that your motive for sharing is well intentioned is not an excuse to share without your spouse’s permission.

When you Just Need to Tell Someone

Sometimes when you are arguing with your spouse, the need to talk with someone without your spouse’s permission is overwhelming. This feeling is magnified because you often feel alone and by talking with someone else at least remedies the feeling of abandonment. Sharing the details of a fight with others, however, comes with special hazards. Couples usually reconcile. The outsider who knows the details of the argument, who is not part of the reconciliation process, often harbors resentment to the spouse that “hurt their friend.” Over time, this may create an outside stressor on the marriage.

Building a Better Marriage

There are many reasons why keeping marital confidences build a great marriage. Certainly it builds trust – which is the foundation of any great relationship. A more subtle benefit is that couples share more truth about themselves where they feel safe. Great relationships are possible when couples don’t hide pieces of themselves from the other.

A Notable Exception

The notable exception to this rule is abuse. If you are the victim of abuse, get help. Otherwise, the best practice is to keep confident what is shared in confidence.

### Brandon Blankenship
Brandon-Blankenship Writing


Brandon L. Blankenship is a continuing legal education presenter and business educator. He is the author of Unmasking Hour. He writes weekly posts on the legal industry and is a contributor to the Nobility Academy. He and his wife Donnalee live on their hobby farm south of Birmingham, Alabama.


  1.  ©2016 Brandon Blankenship, Image Credit: tell me a secret by Senia L CC flickr 2AUG2008.