“Just as the rich rule the poor, so the borrower is servant to the lender.”
Proverbs 22:7 NLT
Betting and drunkenness have ruined the life of Big Man (Not real name), I heard my daddy say to my mum in a conversation. From my childhood, that statement has been indelibly imprinted on my mind. I never wanted to grow up to be poor, wretched and beggarly and so I made a strong mental note of that. I also saw what loans did to contractors. Due to delayed payments and unrealistic projections in an unstable clime such as ours, they may be unable to meet their obligations to financial institutions. Collaterals could be lost, police arrests and litigations follow at times. Those two things are to be handled with utmost care. One is to be totally avoided and the second handled with a lot of discretion.
When few years ago I began to notice the rise and preponderance of loan Apps, I became concerned and frightened for young people. Now I realise my fears should have been for young and old alike with the discoveries I am making of late. I only expected the old to be smarter than to allow themselves to succumb to the allure of loans. However, my thought was that in a nation characterised by poverty and showmanship at the same time, young people will go to any extent to get money to acquire the ‘beautiful things of life’ not giving sufficient thought to the consequences. True to my fears, parents and guardians have discovered their children and wards are owing huge sums of money having downloaded several loan Apps in this digital age.
My first direct encounter with this menace was a couple of years ago when I began to get phone calls from a lending company that began to send threatening texts to me about a church member who had affectionately saved my number as ‘Daddy’. The lenders accessed her phone contacts by the terms of the loan agreement and were mounting pressures on ‘daddy’ to help retrieve their obviously irretrievable sum of money. My experience has been relived by millions of Nigerians. In a country where credit was scarce and loans a rarity before now, the availability of funds without the usual need to provide collaterals has attracted applause and patronage. Unfortunately, lots of people do not know what to take loans for and how to manage them accordingly. The norm today is that people obtain loans from an App and yet from another to pay the first one and continue to move from App to App till they are overwhelmed with debts.
The reality is that a loan is not the money of the borrower. It ought to be handled with a sense of utmost care and responsibility. A loan ought to be sought against consistent and assured income, factoring in all other obligations and liabilities. The only other condition for borrowing is where it is utilized to make more money and this must be based on proven knowledge. For as long as we owe, the borrower is servant to the lender. It is antithetical to our Faith that we borrow money and not return it. It is stealing and nothing less. Living without borrowing is a discipline we must learn and if at all we have to borrow, it should be either to invest it in order to multiply its value or spend it in lieu of certain income like a regular monthly salary and that’s in an emergency or critical need. Borrowing with a wish that God will make a way is nothing but presumption. So many Nigerians are trapped today and their names in disrepute because of this development and it is due to our lack of financial literacy. We must learn to live within our means no matter how hard it is to do so. Hard choices have to be made to simplify life. Shun competition, don’t live to impress. Educate children about the reality of family finances and meet only needs that can be reasonably met with the little you have.
“Wealth from get-rich-quick schemes quickly disappears; wealth from hard work grows over time.” Proverbs 13:11 NLT
A poor financial mindset is one reason people take to betting. It does not help matters that some rich people engage in it but unknown to the poor, they spend meagre parts of their finances to do it and usually they own casinos and do it to encourage others to patronise their businesses. When a billionaire spends 50,000 dollars betting it makes the news, whereas it is a paltry sum to him, neither did he create his wealth that way. Such wealthy people understand that you never commit more than 5% of your capital to High risk investments. Any investment that promises you 50% return on the short term like a month to six months is high risk and not worthy of more than 5% of your capital. Forex trading, crowd funding, financial pyramids and other get rich quick schemes are to be engaged in with minimal commitments of not more than 5% of your income. There are many vultures out there preying on our financial pressures, ignorance and greed with dubious products to take money out of our pockets and we must be warned of them.
Wealth is created by adding value, meeting needs, receiving money in exchange for the value we contribute to people’s lives and the needs we meet, then managing the money wisely. The most basic way of managing money is to understand that the more you build assets (possessions that grow in value) than liabilities (the things that reduce in value), the richer you become. Savings, stocks, bonds, treasury bills, mutual funds, land, buildings, precious metals and so on, increase in value with time but clothes, cars, rents, jewelries (except stored gold for retention of value), shoes and all consumables are liabilities. Money spent on liabilities leave our lives forever and the ones wisely spent on assets grow into our future. Betting is gambling with one’s life and programmed by those who created it to exploit those addicted to it. Many people have been reduced to rags and have fallen from grace to grass through gambling. It is very addictive by nature and should not be attempted at all. But our media are awash with advertisements of possibilities of happiness and prosperity that only exists on the media and not in real life. Most people who have made fortunes from gambling in history have lost the same fortunes to gambling. The fortunate ones who have retained their winnings are very few compared to those who have lost their fortunes. My advice is, avoid it like a plague. I pray this intervention will save someone out there from getting into trouble.