This may sound very strange to many people. Borrow to save? Why not? There are two types of debts, good debts and bad debts. Good debts are used to acquire assets while bad debts are used to acquire liabilities. We are more used to borrowing to spend. You use money you don’t have to buy what you don’t need and then keep paying even when the useful life of the item is long gone. By the time you finish paying, you end up worse off financially.
To Borrow to save can be an asset when you borrow at a lower interest rate and save at a higher interest rate.
There is no excuse for not saving. If you can pay taxes, then you can save. You can look at your savings as another layer of taxation – this time self imposed to secure your financial future. If you can borrow from a bank or your credit union and repay monthly, then you can save. All you need to do is to think about yourself and your financial future important enough to pay your self first – treat yourself with the same respect you treat the government and the bank, taking the money out before living on what is left.
If you do not attach enough importance to yourself and your financial future, you cannot get money to work for you. If you do not respect yourself, how do you expect money to respect you? Looking down on yourself is a manifestation of low self esteem and inferiority complex masked as false humility. You are to love others as you love yourself. How can you truly love others when you don’t love yourself.
Financial freedom inspiration has been nominated as on one the top 100 finance blogs worldwide, coming in at 50. While I feel honored for being listed as well as acknowledging that there are bigger blogs that are more worthy, my focus is on the impact on lives in Nigeria, though I have received mails from around the world of people who have been impacted by this blog.
This blog was the inspiration for my book – Practical Steps to Financial Freedom and Independence and other upcoming events including seminars and talk shows.
The journey to financial freedom and independence is not just about becoming rich, but the freedom to live your dreams, and in the process give others permission to live theirs.
Saving, as boring and old school as it sounds is at the core of personal finance. You cannot move ahead financially in a sustainable manner without saving. Even if you own a successful and growing business, if you do not save or build financial reserves, when the business runs into economic head winds, every thing will come crashing down. In corporate mergers and acquisitions, it is he who has the gold that makes the rules, that is why you see smaller cash rich companies buy up much bigger and broke companies. Cash flow is king, and cash flows sustainably when backed by robust savings.
People tend to run away from saving. Saving seems to have a connotation of self deprivation – delayed gratification, kill joy, settling for something below the top of the range, doing without, not keeping up with the Joneses. We believe we must have what we want and we must have it now. That is one of the key reasons we spend first and attempt to save later. If we save first, we will not have enough money to spend the way we want, so we defer saving.
We tend to believe that taking care of ourselves amounts to selfishness. We brought up to think of others first and scolded when we seemed to look out for ourselves. Where is the fine line between selfishness and taking care of ourselves? We seem to get it all mixed up and end up neglecting ourselves, not loving ourselves and in the process not capable of loving others unconditionally.
Selfishness is when you are self absorbed, thinking only of yourself and what is in it for you. The opposite of selfishness is altruism. Thinking only of others to the neglect of ourselves may seem noble at the surface, but is ultimately self defeating and an expression of low self esteem. You cannot truly love others without loving yourself. You cannot truly take care of others without taking care of your self. If you do not maintain the goose that lays the golden eggs (you), the goose will soon die and with it, the supply of golden eggs.
Seeing that the best way to receive is to give, the right question would be ‘What do I have to give?’. Coming up with a business idea is as simple as looking around you to see what is lacking and asking yourself what do I have to give to make things better. We are good as pointing out what is wrong with everything around us, murmuring and complaining and wondering why someone has not done something about it. We can use those same fault finding skills to uncover opportunities around us and as ‘What can I do to help?’
Most of my business ideas has come out of getting pissed off about a certain situation and finally deciding to do something about it. A business exists to solve problems. It is simply a matter of someone identifying a problem and taking the initiative to get it solved.
The law of giving and receiving is a natural law. Like the law of gravity, it is no respecter of persons. It holds for the young and old, rich and poor, all races and religious persuasions. When you give, you receive. The measure of what you give determines the measure with which you receive. It is simply a matter of time.
In the previous article, we saw that giving is about adding value. That means if you want to receive, you need to add value. Many people start out in business trying to make money, i.e. their focus is on receiving. Many want to make money on the internet. They look at the internet as a gold mine and are trying to figure out how to get their own piece of the action.
When it comes to giving, our minds typically go towards giving money or material things. Giving goes way beyond that. Giving is about adding value, making a difference. Due to this prevailing mindset about giving, most people don’t give as they ought to or should, because they believe they have nothing to give, or have nothing more to give.
When you look a giving from the perspective of adding value, then it becomes apparent that we all have something to give, and our capacity to give is virtually limitless is we keep growing and improving. Consequently, our capacity to increase our income is limitless since giving and receiving are two sides of the same coin. They always go together like lightening and thunder, though there is a time lag between both.
The law of fair exchange is also known as the law of equivalent exchange. This in summary states that:
“People cannot gain anything without sacrificing something. You must present something of equal value in order to gain something. That is the principle of equivalent exchange in alchemy.”
This seems self evident and goes without saying. We all know that “garbage in, garbage out”. However in reality, it is not so simple. We don’t seem to get it. Most folks feel they are not making enough money and life is so unfair. We want higher pay but never stop to figure out how to add more value.
You have just finished your NYSC (or has passed out for a while now) and are combing job sites online armed with your CV. If you get asked what you do, you reply ‘I am a job applicant’. All you do is apply for jobs and wait to get invited for an interview. You cannot move forward from where you are until one if the companies invite you. In effect, they determine your next move, which may include which town you live (depending on where the job is).