Even Billionaires Borrow Money
By: David O.
Tags: Investing, Money, Wealth, Psychology, Finance

Even Billionaires Borrow Money

Yes, billionaires do borrow money. But they do so mainly to grow their empires. Even though they are worth a couple of billions, they would rather not sell what they have already amassed (or trade it). Instead, they would find a way to leverage and stake it to get more money. And then use that money to get richer. That’s how the game is played. Most billionaires do this often. You may not understand that very well yet, but this should make you accept that billionaires borrow money.

If billionaires borrow money, what is the financial status making you say that you will never need other people’s money (or resources)? The problem with debt is not the fact that you borrowed money. Instead, the problem is in what you want to do with the money and how much leverage you have for the debt.

There are good debts and there are bad debts. In the book If you want to be rich don’t work for money, a chapter is dedicated to the concept of good debt. Good debt is borrowed money that becomes working capital. And that working capital produces much more financial value than the original sum that was borrowed.

The problem most people have with debt is that they spend it on things that do not produce money. So, the money becomes dead money. Then, you start looking in another direction to pay back. Yes, business loans get sour too, but a good entrepreneur will still make something work out in the midst of that.

Most people would rather not take a loan. And they can give various reasons for that. However, the main reason is that their project is not big enough. If your dream is big enough, you will involve other people. If it is super big, you will involve financial institutions. Don’t be so full of yourself to think you can do it all alone.

The major reason people want to do things on their own is because of this idea of being self-made. No one is really self-made. Everybody had help. Some are just more pronounced than others.

The concept of self-made has been expressed wrongly by the popular media. No man built a company from the scratch all by himself. No woman rose to the top without any help. The focus is really on what is the nature of the “help” and who were those responsible.

The true meaning of self-made is people who defy the traditional rules and ideas of how people rise to the top. Not that they didn’t have help, but that they led themselves (and other people) through uncharted territory. It is the fact that they succeeded without relying on what other people (like them) rely on. Being self-made is mostly about being a leader.

So, don’t be deceived by this concept. Your success story is not diminished if you ask for help. You are not being a parasite. And you certainly don’t stop being “self-made” if you are a leader.

All great people sought help at one time or the other. The only difference is that they didn’t go ask their grandma or uncle (who knows nothing about money and financial success) for business advice. Great people look for other great people to seek help from.

Someone once said that the reason most people are average is that they ask for help from average people. And great people are often open. They willingly share. Even if you are competing with them, they’ll still share a lot about what they know.

The summary here is not to make yourself too big to ask for help. Billionaires and multi-millionaires ask for help. There are stupid questions but you remain stupid if you let them stay with you. If you ask them, people may think you are stupid but you just became less stupid by asking.

You don’t have to have all the answers. You just need to surround yourself with people that have much of the answers. When you have a question and you don’t know the answer, find someone who does and ask.

One problem a lot of people have is that they have the answer they want at the back of their mind. So when the answer great people give negates the answer they want to hear, they neglect it. Always keep an open mind. Some answers might be very uncomfortable. Try it before you ignore it (as long as it is not immoral, illegal or unethical).

Billionaires ask for help. You should ask for help too. Ask for help today. Don’t beg — ask. Be polite and confident when you ask.

I hope you have learned something.

Cheers.