Leverage, and using other people’s money
Our grandparents used to have a row of jars on the shelf, one for the car, one for a holiday,
and every spare note or coin they had went into one of the jars, and when it was full, they took
it and bought whatever they’d been saving up for. Our parents started using consumer credit a bit
more, but still had the attitudes of their parents, so we have been taught and conditioned that all debt is bad.
I’d like to take a new angle on debt, using our previous conversation on assets and liabilities.
There is ‘good debt’ and ‘bad debt’. Quite simply, if the debt you have is producing income,
then it is good debt. If the debt you have is costing you money, such as a car loan or a credit
card, then it is bad debt. Leverage with Property investments
But without debt, how are you ever going to invest in property? I mean, even if I saved up for
years to get to the position where I could literally bring a briefcase full of cash to an open
inspection, I wouldn’t even consider using my own money. Leverage with Property investments

Why?
Because borrowing money from the bank is leverage. Leverage is defined as doing more with less.
The ancient scientist Archimedes said “Give me a lever long enough, and a strong place to put it,
and I will move the world”. And he meant it literally. Just as a crowbar can open a stuck door,
other people’s money enables you to create wealth without using your own money. You can now stash your money away safely.