GBESENOMICS

Gbesenomics is a term I coined from two words, “Gbese” which is the Yoruba word for debt and “economics,” the study pertaining to the production, distribution, and use of income and wealth. Thus gbesenomics can be said to be the science of using debt to produce income and wealth.

I make bold to declare to you today that one cannot become extremely wealthy and successful financially without debt. In all my years of studying the success patterns of billionaires I have discovered that not one was able to invest in substantial business opportunities or to expand their businesses without debt. They are avid students of gbesenomics and have built great fortunes using it.

Sadly those living in poverty and lack, may also be  in debt but they have been unable to harness it to good use in their financial lives. There is a science to it. Here are ten key facts you should know about debt.

Firstly, debt is not a bad thing. What makes debt bad is when you get involved for the wrong reasons. For instance getting into debt to buy clothing for family events and investing in other frivolities is wrong. However there is nothing bad about getting into debt to purchase an asset that will yield more for you or appreciate, such as land. The major issue is what you are investing in. In fact debt is the rich man’s best friend for he uses it to attain his goals.

Secondly, endeavor to first try to raise debt financing from your loved ones. This is because they may not charge you any interest on the loans they are providing. The key thing is to be on the lookout for the most favorable terms you can find. Let the financial institution be your last resort if you can’t help it.

It is also important to consider thoroughly what you want to invest the debt finance into before you take the plunge and carry debt. The business idea or opportunity you want to invest in must have favorable terms that allow you to invest and gather enough returns to pay the loan and interest, and still provide you with a neat profit sometime in the future. For example if you have an LPO to supply diesel and you are sure of getting paid no more than 30 days after supply and stocks are readily available, nothing stops you from seeking for debt to fund the supply and repaying quickly thus reducing the effect of interest.

Fourthly, it pays to seek to liquidate your debts as quickly as possible. Once the returns begin to arrive pay off your debts first and then pay yourself last. This method will help reduce the impact of interest on your debts as you will be paying back earlier than expected. Nothing builds your credit rating and credibility when you pay your debt obligations even before when due.

Seek to balance the amount of debt you are carrying. Don’t just keep amassing more debt just because you have the capacity or the opportunity to do so. A finance guru once said it is easy to borrow, but difficult when it’s time to pay back. Strike a balance.

Sixth, take the debt options as a last resort, especially after having considered other options that are available. For example can you bring in partners who would fund the venture and share in the gains? Try to explore other options first before considering debt and be very sure of the potentials in your idea.

Seventh, debt is a good example of leverage at work. You may not have the resources for the investment or venture but with debt you are able to use other people’s money to fund it. Some of the world’s richest people are becoming wealthier using leverage to build stupendous fortune. They use their clout, reputation and image to secure facilities with favorable interest rates and repayment cycles. This is then invested and the returns used to finance the debt. In some of these deals not one penny of their own funds is involved.

It is also important to understand that every entity has at one time of the other owed. Individuals, corporations and even governments all make use of debt to finance certain worthy plans and objectives they are desirous of achieving.

Ninth, scrutinize thoroughly the terms and conditions on which a loan is been organized for you. Let the these be part of the factors that you carefully considered before taking the funding. Take care to read and study the accompanying documents and ask questions regarding what you do not understand. This way you have a perfect understanding of what you are committing yourself into. Don’t rush to commit yourself into anything; it even pays to get a second opinion where possible.

Finally the banks and other financial institutions are set up to provide loans and debt financing. Make it a point of duty to understand what products and services that could be of use to you. Don’t forget to shop around and compare terms and pick the option with the best favourable options for you. There is so much competition when it comes to giving loans to worthy individuals among banks today. Many banks are on the lookout for quality people to provide loans to..

The onus is now on you to become a specialist in gbesenomics in order to join the league of the really wealthy.Debt leads to wealth!