You can review the first four secrets here: Part 1, Part 2, Part 3 and Part 4.
Here is the final in the five-part series:
Secret #5: Become a Lender, not a Borrower
Proverbs 22:7 says: “The rich rules over the poor, and the borrower is the slave of the lender.”
Many people who borrow do so in an endless cycle which ultimately leads to financial destruction. They will borrow short term loans at high interest and then find that the succeeding months have them borrowing the same way again. There are many reasons for this. Two of which are:
Not all borrowing is bad. If you borrow for productive purposes (a business, your house,
an income producing venture – a car that helps you to produce income) this is good. If
you borrow for consumption, you are on the road to poverty. You find that such persons
keep borrowing, are already maxed on their credit cards, and are always in debt. This is
the slavery that the Bible speaks about.
If, for example, you are paying interest (that may even rise during the term of the loan!)
and what you bought with the money you borrowed is a new car, then you are paying
interest on a depreciating asset.
If you drive a brand new car out of the show room as your own, it probably loses 15 percent or more of its value because it is now a “used car”. So what financial sense does it make to borrow at interest to purchase an asset that is losing value? Instead, keep your car as long as possible, until you can buy a new one in cash.
The same principle goes for hire purchase of consumer goods. Think, think, think -- before you borrow.
Jamaica went through an unfortunate economic experience when interest rates rose to as
high as 100 percent. But guess who were complaining? The ones who borrowed money!
The lenders were smiling all the way to the bank.
A lender will always be served by a borrower.
I invite you to share your thoughts on this topic in the comment box below.
Tony Williamson is a motivational speaker and author of the book, "The Courage to Conquer: 9 Inspiring Strategies to Be Bold, Overcome Obstacles & Forge Your Fantastic Future!" For more information please visit www.tonywilliamson.org and on Facebook: www.facebook.com/tonywilliamsonbooks. Email: email@example.com
I am an author, motivational speaker, chartered financial consultant, linguist, paramedic,