There is an old-fashioned saying ‘neither a borrower nor a lender be’ which means that the person will never borrow money or lend it to anyone. It indicates that doing either of these things is not right and should not be allowed. There are some people that decide that they will stick strictly to this. It could be that they have for their whole lives or that they want to start it at a particular point in their lives. However, living by this can actually do more harm than good.
Many people feel that borrowing can lead to trouble. It is true that sometimes loans can cause problems but that is not true for a majority of them. If you take out a loan and struggle with the repayments then you can get yourself into all sorts of trouble. However, if you borrow money and then repay it on time, it can be extremely successful.
The success of the loan can be determined by a few things. Firstly, your ability to repay it is really important. If you can easily manage the repayments with no stress and hassle then it could be classed a success. Also, it depends on what you use it for. If you use a loan to better yourself such as to buy a home, then you could end up significantly wealthier than you would have been had you not taken the loan. However, if you use an overdraft to go out drinking, then this is unlikely to help you to better yourself. It is also really important to make sure that you get the right loan for the job. Choosing the loan that will address your needs the best, that you can repay easily and that offers you good value for money will also make borrowing a much more positive experience.
Therefore, there is good and bad borrowing. It is always worth thinking hard before borrowing any money so that you can be sure that it is the right idea. You should think about why you are borrowing the money, which type of loan and which lender is most suitable and whether you will be able to repay the loan. If you spend some time thinking about this you should be able to make a decision about whether what you want to borrow money for will be a good idea or not. You should not dismiss all loans without careful consideration. Many people take on large loans in the way of mortgages but really benefit form them, especially when they retire and can live in their house with no worries about having to pay rent.
You may think that you do not have enough money to lend to anyone or it is just something you would never consider and so this part will never apply to you. However, it might be possible that you will be lending money without realising it or that you get asked and have to make a decision.
Firstly, if you have money in an account with a bank then you are allowing them to lend that money to others. Obviously, this is very different to lending it directly, but your money is still being used in this way. So, if you feel that lending is not something you can do, then it is likely that you have done it a lot already and so should not be concerned about it.
You may also find yourself in the situation where someone asks you for money. You may instinctively feel that you will always refuse but this could change. If your child, sibling or parent asked you for money then it might be much harder to refuse. You will be tied to them in a different way that you might be to friends or other family members and it might be much harder to refuse.
It can be worth thinking about what you might do. You could lend to them but with terms attached. You may wish them to repay you at a certain rate or with a cost attached. This could help them out and might also help you to make some extra money as well.
It can be good to be open minded when it comes to borrowing and lending. It could help you and others significantly. If you close your mind to both of these then it could be the case that you will actually be making yourself worse off. Borrowing and lending can seem scary but they do not have to be. It is a case of making sure you research properly and feel that you can trust yourself and others. Many people do these very successfully and there is no reason that you will not be able to either as long as you are really careful when you do it.