One of the first things you learn when you leave your “Mummy, is there food at home?” phase is that money, no matter how much it is, is never enough.
There are bills, expenses and unknown evil spirits that suck your money, never to be seen again.
What then do you do when you hit a dry patch? The obvious option is usually to take a quick advance or a few loans from your friends.
And when you and your finances are in agreement again, you pay back the loans. Sounds simple, right? Except the whole thing is a setup.
You want to know why loans are an idea from hell?
Let me share my lessons from the other side.
They encourage you to over-spend
Knowing you can get a loan when you want increases your tendency to spend more than you actually have. Meaning you basically spend your money in advance.
Sadly, this doesn’t dawn on you until you have to part with the money later–around the same time you realise you probably didn’t need that thing, or you would have been better off if you’d saved.
Now, you don’t know how you’ll make it to the end of the month. Congratulations, you played yaself.
Issa Slippery Slope
You need 5k for a quick bill payment. So you call your guy to do a transfer. Someone suggests a road trip that you’d love to go on, but no money. So you call your guy to do a quick 30k bank transfer.
You get home from the trip and as you try to set your bag down to open the door, your phone’s screen cracks. You could wait and save up–but you call your guy again.
Then you wake up one morning to the news that you have to sell all your property because your guy wants to pay his rent and he needs his money. How you see life now?
There’s no rest for the wicked. And except you’re one of those people who didn’t come with a factory-fitted conscience, knowing you’re in debt can linger on your mind and be a major distraction, especially when you have trouble paying back.
You’ll never be able to save
How do expect to keep money away for a rainy day when all the money you have is not even yours?
What’s worse? You’ll have a hard time achieving anything
Okay. Maybe it’s not that serious. But, from experience, I know that being in debt can be a hindrance to actually using your money to do stuff you care about.
Like saving up for a course or to go to that Burna Boy concert you’ve been planning since you heard “Like to Party”.
So what do you do when you fall short of cash?
Prevention, they say, is better than cure. So the best way out of such situations is to ensure you don’t get there in the first place.
Set aside a percentage of every amount you get as your untouchable savings. That way, you can be covered when those ‘unexpected’ show up.