Topic: A lot wealthy people not smart they just use debt - page 3. (Read 1271 times)

It cannot be denied that in business debt is unavoidable, I think it is not a trap but rather an encouragement that makes the business grow. So in my opinion it is completely irrelevant if the person who owes the business is a fool.

If reviewed in more detail, debt in business can be used as a source of financing for business growth. By borrowing from suppliers, companies can expand their operations, increase production, or take advantage of larger business opportunities.

I agree with that and in fact there are many businessmen who have done that, whether for large or small businesses, of course they will use loan money to further enlarge their business so they can get bigger profits, that is a normal thing in business and I think they are not stupid people.
In fact, they are business actors who are afraid of the risk of taking out loans and it will be difficult to develop if they do not have large capital.

And indeed everything comes back to calculations, even though the risk is still there, but if you want to develop a business with loans, I think it's quite worth it.

There is no problem taking a loan to improve the business we run because if we don't dare to take risks it will be difficult for us to develop.
Taking out a loan for consumption needs or just for lifestyle is a mistake that must be avoided and most people misunderstand the meaning of a loan.
Most entrepreneurs definitely have loans and most of them develop their business using money borrowed from other parties. If there is no calculation and we are too hasty in taking out a loan, we will be faced with problems.

Loans are productive, there is no problem as long as we understand the business we are running and the use of borrowed money will be much more targeted.

People say the rich become richer, the poor get poorer? It's more than money mismanagement. All of the system is designed that way. Rich guys borrow money like nothing, take their time paying it back, and get richer. Why? Because they play by different rules. The rest of us are panicking over every credit card statement, trying to stay afloat

Instead than scaring people about debt, teach them how to use it. Let's teach them the affluent guys' secret techniques. Let's make debt a tool for wealth creation, not a prison. An instrument of freedom. We should promote that kind of financial education

Exactly so, we must always consider our needs. It is not right for us to do anything in excess of necessity because everything in excess of necessity is a threat to our existence. And we must work smart so that our work progress very quickly. But we all know that loans are not good but in business sometimes businessmen have to resort to loans. But it is also wise to pay off the loan as soon as possible.

Leveraging (borrowing) to purchase income producing / appreciable assets, where the income from the assets more than covers the cost of borrowing (interest) is one thing.
Utilizing debt to cover income shortfalls or support lifestyle inflation is something entirely different.

Knowing the difference and making it work to your advantage is indeed smart. 

That's the point, we can't say that wealthy people are not smart but they just use debt because you can't use debt in a good way if you are not smart. Only people who are smart and have sharp minds can take loans and use those loans in the best way possible so that they can generate way more money than they have borrowed and repay the loan with interest before the repayment date, that is how you build your credit score and get bigger loans next time and rich people do that exactly.

Those who are not smart can't become rich because even if they take loans and debts, they won't be able to use the money in a good way to start businesses or expand existing businesses so that they can get revenue enough to repay the loans and have good credit score for future endeavors.

Businessmen usually act according to a plan. This plan prevents them from making mistakes. They have experience in the market or in any business and this experience enables them to do successful business.

Borrowing is always helpful when done right. In order to grow further and generate income, it is necessary to make the best use of resources, that is, to be on the verge of limits. This is not always the case, so there are exceptions. Borrowing is also a risk, but if it is used well, it helps a lot.

Many rich people prefer to increase their wealth by taking on debt. In this way they can manipulate the taxes they would otherwise have to pay to become very small because in their record of wealth what they have is debt. A business like this must have very strong calculations and planning and also have very high courage. When we are in debt we have interest to pay so we have to carefully consider the money we have from debt to build a business that is very profitable and has very high demand.

The OP subject looks confusing because I don't understand how you own a business and he thinks it's easy to use debt to fund a business without been smart enough and he thinks that is going to work like a spider man that jump from one roof to another, that's a big lie. Even if you own a company, there is no assurance that banks or any institutional would want to loan you money unless you agreed to their conditions where they will want to see some of the companies receipt and money you generate to know if you can pay back or not.

Businesses are run by smart people who have something upstairs and understand how to compromise situations to always save the business from running into shambles and anytime that will put the business on hold. No companies works on debt without some formalities which must be enough to satisfy a lender, it doesn't work that way. There are some situations that a company history of revenue wouldn't guarantee you anything unless you even have a personal connections or networking.

That is how they grow, and make more revenue as well. Debt to grow is something that you must do as a business, if you are not doing it then you are not making the most out of your business, and that means we are talking about something that is getting a bit more limited if you stop growing.

Every single business person would know that you should never be debtless, if you have zero debt then you are doing something wrong. You should at the brink of your last line, so that you grow more and have more revenue. If you do end up getting debt and still not make more revenue then you are doing something wrong, you did not spend that debt on something smart. A lot of companies bankrupt because of this as well, so it is not really a shocker.

In business, debt is only normal because they want to increase capital to expand their business network. What becomes confusing is when some people go into debt just for consumption and that should be avoided because it will disrupt household finances if income is not balanced.

Business people have made detailed calculations before applying for credit or taking on debt, they will not be in a hurry because it will have a negative impact on their business. So they are really smart people who are able to manage their business patterns well.

You seem confused on a lot of points, like stating people are rich because of their credit scores - that's not how it works. It takes time to accrue a decent credit score and to maintain it you must be a responsible borrower that pays off their debts. In my experience it is only the smartest people that are using credit to their advantage, lots of people go through life trying to borrow as much money as possible and paying extortionate interest rates. If you borrow money at 3% and can make a 6% return, it is literally the same as printing money. This is what people with large amounts of wealth are doing.

Often we listen that the rich uses loans to develop a business and it is done with full risk. But the important lessons we get they take loans for things that are far more productive compared to some people only use loans just to fulfill lifestyles.
Now the time has changed and if we don't have money it will be far more difficult to develop a business. For me, taking a loan for positive things is not a problem because it can support the business needs they are running.

To achieve wealth you must dare to take risks and this is done by some rich people. Why are they successful because they dare to take risks and that's why we need to try by considering everything before deciding to do it

Taking debt is not something that should be fear of, because as long as you are putting your debt into the right investments, you will definitely have good returns later on. That’s why most of the smart people do not just save and invest, but take loans so they can maximize their investment. Once their investments paid off, aside that they can pay their debt easily, they can also maximize their savings and eventually put it into other investments. That’s how smart people are thinking.

However, it’s still a good reminder not to take debt unless you’re capable to pay. Some investments do no work according to our plan, so it’s best to prepare for it as well.

in a business sector to be more advanced we definitely need a loan, I think it doesn't matter as long as we are consistent in using it to develop the business and enlarge it. This way we pay the debt in installments and with interest, and we have to take into account that the loan can be burdensome and that is a breakthrough. to advance the business so that it is more advanced, but we have to think again because all of this requires quite a long process.

Lenders do not require loans for entrepreneurs but they like borrowers below the average income because the main condition of the loan is that they must provide collateral that can be used as collateral if the loan is not repaid on time, they want the borrower to pay late for the purpose of increasing the loan interest every month, even though it is not all loans are bad ideas but most loan services want higher profits from borrowers who earn below average.

Generally, entrepreneurs are experienced in handling loans and have determined an appropriate business plan to gain profits from loan capital that has been turned into a potential business. However, if you don't have business experience, it is recommended that you don't rush to apply for high loan capital, consider the business risks so that you won't be able to pay the loan if you don't reach your monthly profit target, so it's better to increase your business knowledge by managing a small business without loan capital or starting a business career. from experience working on other people's businesses.

I don't know for you but from my little knowledge about dept. Dept is a risky thing, because when you are a deptor you won't have a mind rest, always your mind will be at trouble because if you can't pay back the dept you owed, more interest will be added to it and that's how it continues to increase if you don't pay back on time. Why I won't agree with you when you said that the rich are not smart but uses dept, is because many of those rich people you see are the ones who can plans and work smart to pay their depth on time or pay the dept late, but at the end they can be able to pay no matter the interest. I think you should respect anyone who didn't come to this world with a silver spoon because it's not easy to upgrade from poor to rich. A rich depor will rather not pay his loan until he achieve that thing he wants with the money he borrowed, and when he has achieved what he wants before he can start paying up his depths and the interest. The reason why the poor deptor haven't achieved what they want with the money they borrowed is because they are afraid that the Interest increase if they don't pay up on time. And because of that they will keep what they want to achieve aside and focus on paying their dept and still end up not paying on time because they didn't achieve what they want.

This says it all, it's all about the mentality that we have that will determine how far we go in this life especially when it comes to business or wealth decisions. You can't be having a poor man mentality and be doing things like the rich. The rich man buys a yatch/private jet and turns it into a business but the poor /middle class man buys that (if he can afford it) and use it to display his wealth to people that don't care. The poor acts rich to oppress the poor while a rich man doesn't have the time to start proving to you that he is rich. He does things in the way he wants and can choose to behave in anyway he wants because of his mentality


Before someone can use debts to make money, he has to be smart so wealthy people are actually smart and aren't just lucky. It is only a few that are lucky and the wealth don't always last in their hands. Money pays attention to only people that have the power to control it. Using debt to make money is a unique technique that most rich people (that got wealthy through other means) can't understand so you don't call someone that does that a lucky person/not smart because then you'll be lying or just hating.

Loans that have interest and must be paid on time are loans that have been thought more carefully before being made by anyone, because if they are not considered more carefully, it will certainly have fatal consequences for those who borrow them. So assigning a loan to a business that is already running smoothly is the right thing even if the borrower does not use all the profits to pay the loan at each maturity date. But the basic capital certainly cannot be reduced because this is where the source of income can grow and can be used to pay off all loans that have been taken previously.