Neither a Borrower Nor a Lender Be

"Neither a Borrower Nor a Lender Be" - Shakespeare


Have you ever stopped to consider what that famous line from Shakespeare's Hamlet means. I know, I for one had heard that phrase numerous times, but never gave it much thought, until now. Now that I am working to get debt free, that phrase has come to mean so much more then I had ever thought it would.
Rich McIver of CreditCardLowDown.com

Credit cards were just making an appearance in mom's day, but to see the way plastic has replaced cold cash today, one would think they've been around forever.

Nowadays, borrowing to buy a home is considered by even the most conservative financial experts to be a good move, but spending is a big problem, as evidenced by the millions of Americans who are in debt over their heads. Nowadays Shakespeare might be more likely to advise us to "neither a borrower nor a spender be."

It's spending, not low income, that is at the root of most financial problems. Sometimes events beyond our control can propel us into debt, like the loss of a job, the death of a spouse, or large medical bills, but let's face it: for most of us, spending is what gets us into trouble. In fact, I believe that the key to having money is learning not to spend it. Notice that I didn't say "learning how to spend it," but rather, "learning not to spend it.

The more money most people make, the more they spend. If they get a raise in salary--they buy a newer car, or a bigger home, or a bigger, better whatever. But it's not just the big things they buy, it's all the little things they now feel they can easily afford, and those things add up amazingly quickly.

When you borrow, you end up paying more for everything, then you would have if you had paid cash. When it comes to lending to family and friends, it just becomes a barrier between the two of you, especially if they thought it was a gift (and you thought it was a loan) or are slow to pay you back.

As Dave Ramsey, John Cummuta and so many others have said over and over, it's better to pay cash for everything. You end up paying less, and in the long run the tortoise always wins.