Insight into Humanities oldest form of currency

There’s an old American saying that goes: “Before borrowing money from a friend, decide which you need most.” Few things in life have the power to crush the indomitable human spirit like hearing the simple phrase “you owe me one.” The universal shame of being in debt transcends cultures, with an almost primal aversion to indebtedness. Humans, it seems, universally HATE debt and anything associated with it. But what if I told you that getting into debt might just be the financial move of a lifetime? I know, it sounds like a crazy notion.

Throughout our lives, we’ve been drilled with the mantra of “stay out of debt,” “live debt-free,” or “clear all your debts for a good life.” While that advice is generally solid, in today’s society where debt intricacies are deeply entwined, perhaps it’s time to rethink the very nature of debt and consider it as a potential ticket to financial independence.

Let’s break it down into two categories: Good debt and bad debt. Bad debt is the familiar kind – the one you incur for something of little to no value to your financial future or out of sheer desperation. That flashy car or that barely affordable mansion falls into this category. These debts leech away at your finances without offering any tangible long-term value, a financial vampire, if you will. Getting rid of bad debt is sage advice; it has ruined countless lives.

On the flip side, there’s good debt, a concept known by few and mastered by even fewer. Often reserved for the financial elite, it’s time for the next generation to grasp this revolutionary notion. In 1944, with the establishment of the World Bank and the IMF, the US dollar became the world reserve currency. Fifteen years later, the gold standard was abandoned, and the creation of new money became synonymous with borrowing and lending. Good debt is what allows you to generate more wealth in the long run – education, rental properties, and starting a business fall under this category. As Robert Kiyosaki aptly puts it, “Debt is simply the ability to create wealth.” Let that sink in.

Now, you might wonder, “Why go into debt when I can pay for these upfront?” The unique nature of debt lies in its untaxable quality. Money is loaned into existence, and the government doesn’t penalize you for stimulating the economy or creating “new money” through borrowing. This is why they hand out tax breaks and bailouts to big corporations – they create jobs and opportunities by borrowing big.

Consider this example: you own a property worth $100,000, spend $50,000 on repairs and upgrades, and an appraiser values it at $350,000. Normally, you’d sell and face gain in value tax, but savvy individuals use this moment to increase their portfolio, getting another loan to buy more properties until they have a real estate empire. And you might ask, “What about the interest?” In this scenario, if your investment properties are generating cash, you’d be light years ahead of your interest payments, confidently claiming you’ve not just beaten but pummelled interest into the ground.

In conclusion, debt is a fascinating phenomenon with polarizing opinions. This kind of financial knowledge shouldn’t be confined to the upper-class elite; it’s high time we, the next generation, grasp these concepts. For a deeper dive, check out “Rich Dad Poor Dad” by Robert T. Kiyosaki. As I navigate my journey to financial independence, I believe this insight could aid you in reclaiming our freedom and making the most out of our lifetimes. Thanks for your attention, and happy hunting!

NB: How’s that for a first article. Starting ts with a bang.

Imran Mohamed

Student Writer For Before35

Disclaimer:

Disclaimer: The information provided here is for general informational purposes only and should not be considered as financial advice. It is based solely on personal experiences and is not tailored to any specific individual’s financial situation. The user should conduct their own research and, if necessary, seek the advice of a qualified financial professional before making any investment decisions. The user acknowledges that all investments involve risks, and they are solely responsible for any decisions made based on the information provided. The author and the platform do not assume any responsibility or liability for the accuracy, completeness, or timeliness of the information provided.