Learn how the classic lessons from The Richest Man in Babylon apply to Japan, turning monthly rent payments into a smart way to build wealth and secure your future.

Introduction

Did you know that a book written about 100 years ago already taught that having a house leads to wealth? The book ‘The Richest Man in Babylon’ by George S. Clason is a famous guide on building wealth that people still read all over the world.

Through stories set in ancient Babylon, it teaches ways to save money, grow money, and live a rich life. Inside, there is an interesting teaching about housing: ‘Make your home a profitable investment.’

A life of paying rent versus a life of building wealth

For example, imagine two families paying 90,000 yen for housing every month. The first family lives in a rental home (*shakuya*). If they keep paying 90,000 yen every month, they pay a total of 21.6 million yen in 20 years. Even after paying this much for 20 years, the house does not belong to them.

Now, what about the other family? This family used a housing loan to buy their own home. Their monthly payment is also about 90,000 yen, but as they keep paying, the remaining loan goes down, and part of the payment helps build their own property value.

Of course, you need to pay fixed property tax, repair costs, and insurance. Even so, if you buy a house at a good price and make an easy payment plan, you can turn your housing cost into future wealth.

Why owning a home is even more important for life after retirement

We cannot keep working forever. When you reach 65 or 70 years old, will your pension be enough to pay for rent, food, medical care, and other living costs?

If you keep paying 90,000 yen in rent every month even at 70 years old, you will pay 21.6 million yen just for rent in 20 years. On the other hand, a person who buys a home at 35 and finishes paying the housing loan by 65 will not have the heavy burden of rent or loan payments.

This is very important when you start living on a pension. A home is not just a place for the family to live, but it can also be a financial base to protect your future life.

A truly rich person is not one with high income, but one who builds wealth

One important lesson from ‘The Richest Man in Babylon’ is that having a high income and being rich are not always the same thing. Even if your yearly income is high, your wealth does not grow if you spend it all. On the other hand, if you save and invest with a plan, you can build great wealth.

Here, the difference between ‘income’ and ‘assets’ is important. And a house can be one of those assets. The important thing is not just owning a house, but increasing your net wealth while thinking about the balance with debt.

Conclusion

Written about 100 years ago, ‘The Richest Man in Babylon’ teaches that how you use the money you earn is important to become rich. If you plan to live in Japan for a long time, buying a house is worth considering as a choice for building wealth.

Ji Consulting is here to help foreign residents with questions about buying a home and housing loans. We offer support in English (LINE or WhatsApp). Please feel free to contact us for peace of mind in the future.

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