Cash is Trash, Why Do We Need Credit?
Written by Richard Le on Mar. 25th 2021
"What consumerism really is, at its worst is getting people to buy things that don't actually improve their lives." - Jeff Bezos. The common trap many of us fall into is using credit to buy stuff that either makes us "look rich". Most people don't even realize you can use credit to build wealth or, at the very least, financial independence.

I don’t believe everyone wants to pursue wealth and riches, but I do believe everyone should pursue financial independence. What is financial independence? It’s simply the ability to pay for your basic bills and necessities from the income from your assets.

According to Monster, approximately 41 million baby boomers are STILL working, my guess is that it’s not by choice. Rarely do we see a person in their golden years working at Walmart because they love the company, they are doing it out of necessity. That’s simply because they don’t have enough money coming from their investments and assets for them to retire comfortably and with dignity.

People look at finances incorrectly. I say cash is trash because it is constantly losing value especially as the Federal Reserve prints it like it’s going out of style especially during the pandemic in 2020. Money must be looked at as individual soldiers and servants that you can send off to multiply and create steady streams of cash flow for you.

Credit is considered to be the gateway to wealth. Credit is one of the most powerful tools that ANYONE from age 18 and up has the ability to leverage to create streams of cash flow. This means even if you are dead broke banks will extend credit to you for little more than your signature. You can then use OPM (other peoples’ money) to multiply and make some of your own.

Unfortunately, people are manipulated by corporations through advertising to get them to use credit and buy things that only lessen the power of their borrowed soldiers and servants. Instead of multiplying them, they dwindle into nothing, and in many cases they actually go into negative because of the interest they have to pay.

Not all debt is bad, in fact, it’s pretty simple to determine whether you have good debt or bad debt. If you have a loan or credit card balance for something that is costing you money and/or losing value it is bad debt. If you have a loan or credit card balance on something that is making you a profit and/or increasing in value then chances are you have good debt.

For example, a car loan is typically bad debt. Your car is costing you gas, insurance, maintenance, and is losing value quickly. A mortgage is an example of good debt because you are buying an asset that will likely increase in value.

In fact, real estate has created more millionaires and creates wealth more consistently than any other asset class because of the many benefits it provides: Cash Flow, Appreciation, Depreciation, Leverage, Loan Pay Down, Forced Equity, Inflation, etc.

Credit is like a chainsaw. If you are ignorant and play with a chainsaw it can saw off your limbs and leave you in bad shape. But if you’re educated you can chop down some trees and build a beautiful home with it.

Stop allowing corporations and marketers to manipulate you into making THEM rich. Build your credit and start using it the correct way.

Richard Le

Richard Le helps people build their credit and cash flow to buy their dream home and invest into real estate. He is an expert in credit and mortgage lending and has been helping people build their cash flow for the purpose of acquiring real estate. If you're interested in building your credit and cash flow to build your own real estate portfolio then definitely reach out and book a call today.
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