Here is the 3rd rule of  Wealth building principles from The Richest Man in Babylon.

Make thy Gold Multiply

Make Thy Gold Multiply or in simple terms “Multiply your gold or Make your assets multiply”. 

Make your money multiply – Make your money work for you, then its sons [interest] and the sons of their sons. Investing your money through investments and opportunities for asset building. Then your wealth multiplies fast.

We have work hard for money and pay ourselves first. Then we have decided to control our spending which allows us for higher savings and investment to build our seed capital for investments.  This is the exciting part where we make our money work hard for us.

However, in reality, most people don’t know how to make their money work hard for them.
They think they are growing their money though savings in bank, earning a small return of 2%, whilst yearly inflation rates are eroding their value of money.

So, how do you multiply your wealth? What does multiply your gold mean ? It means invest and grow your money.

You need to invest for compounded growth which is the key to building your wealth. Compound growth requires time, rate of return, amount invested and frequency. The real key for compounded success is Consistency and Self-Discipline.

“ Every gold piece that you save is a slave to work for you. Every copper it earns is its child that also earn for you.”

You need to Save and Invest the Difference.

In the beginning, your savings may be small, so put into a savings account that bears interest. Once the amount is sufficient, you can then invest in other higher interest bearing instruments, like FD’s, and buy assets like Government Bonds, Mutual funds, shares, properties.

In the book, Rich Dad, Poor Dad, Robert Kiyosaki mentioned as a number one rule, that you must know the difference between an asset and liability. And we must always buy assets. To simplify, asset put money in your pocket and liability takes money out of your pocket. If you want to multiply your wealth, you need to build your assets. Rich people acquire assets. The poor or middle class acquire liabilities but they think they are assets.

Therefore, to multiply your money and make sure your money work hard for you, you need to buy assets and use the greatest tool available to us to grow our money through compounding. Are you buying assets or are you buying liabilities ?

In my next post, I shall share with you the magic of compounding and the Rule of 72.

I hope you have enjoyed my sharing. To your success and financial abundance.

By Michael Tay   www.michaeltay.com

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