People want things, and they want them fast! That’s why credits are so popular. You can buy a thing literally, paying no money now! Very few people think about what price they would pay for it in the future.
Paradox of life is fast = slow and slow = fast!
My first mentor told me: “If you can’t buy something with cash, you can’t buy it.” That statement really stuck in my mind. And I realized that if I wanted to buy a flat, I had to possess substantial amounts of cash. At first, I was shocked because I didn’t believe I could get it. I lived with that idea for a few months until I got it.
Then, I decided to make some calculations:
“To buy a flat in cash, I need $100K.
That means my income should be no less than $5K a month.
I spend $2K on living expenses, and I accumulate $3K.
In 3 years, I would possess $100K”.
My eyes nearly popped out of my head when I realized that, with my full-time job, I would never buy a flat, as I made $1200 a month. Even if I climbed the career ladder and reached $3K, it would take me around 9 years to get money for my flat! The full-time job path led to a dead end.
Tears welled up in my eyes. I felt miserable and hopeless.
But the good thing was that I started to think about a totally different life path. Instead of thinking about climbing the career ladder, I started to think about starting my own business as it was the only way to make $5K a month and more.
If I had counted on credit, I would not thought about starting my business, as making $3K a month would be enough to get a mortgage. I would have paid off the mortgage by the age of 50.
Thinking about buying something in cash, you expand your limits as your goal might be way bigger than your current opportunities. Yes, it was a tough decision to start a business. I didn’t have a clue what business to start.
5 tough years, and I reached $10K in business. 2 years later, I bought the flat, paying $116K in cash. It took me 7 years to buy a flat instead of 30 compared to credit. Of course, with the help of credit, I would have bought the flat even faster than accumulating money with my own business, but I would have spent decades paying off the mortgage, feeling obliged and pressured to pay a monthly bill.
When buying something with cash, you own it immediately. You can come up with the next goal and focus your energy on it.
When buying something with credit, you get it immediately, but you haven’t owned it yet. You lease it until you pay it off. Happy emotions from buying a flat or a house will settle in 3-6 months, but the debt will haunt you for decades. In reality, you’ve taken on a burden that weighs on you every month!
No, I don’t mean that you must buy a flat or a house only with cash. I just want to show you the difference between buying a thing with cash and credit. And for that reason I take buying a flat as an example.
I believe it’s better to get a mortgage than to rent the entire life.
When you buy something with cash, you own it. You’ve won the game, and you can switch to another pursuit.
Buying with credit you get the thing, but the game still continues until you pay off a credit. And imagine how many games you’re playing at the same time, taking on so many credits. No wonder these people feel overwhelmed, exhausted, and often desperate. They can’t stop running!
People who own things can stop at any moment and have a rest.
People who lease things can’t stop because if they stop, they lose a thing.
Freedom is the ability to do whatever you want.
Obligation is opposite to freedom and that’s what you get when you use credit.
Strive for Freedom!
