People earn money and get on the richest list of prestigious magazines. Some inherit it and do not add to it, tilting the scales for the ones who are successful in multiplying the inherited wealth and stay on the top. The rich are more in debt than we tend to think. While the middle class borrow to maintain their lifestyles and to pay the bills, the wealthy use debt to expand their wealth. Most rich people are not debt-free. The middle class and many lower-income Americans rely on credit cards and home-equity and other loans to meet living costs. You are not rich; it is OK, to certain extent. Who do you think you are kidding if you pretend to be rich by spending money you borrowed?

Do not feel alone and depressed because you are in debt. On the flip side, you are not alone. On the brighter side you have the makings of the rich and famous. Billionaire CEO Larry Ellison, of Oracle Corporation ran up more than $1 billion in debt. Forbes Magazines named him the 4th richest in the world. Forbes magazine puts his net worth at $18.4 billion. Borrowing among the richest Americans has never ceased in the past few years. Low interest rates have augmented their leveraging capacities and their wealth.

Debt has always been thought as a poor man’s prerogative. But the modern day economics offered it as a powerful tool to change the face of the financial world. The precedence set by the modern rich-folk indebtedness has glorified borrowing. The breed of this rich individual actually established it as the ability of taking advantage of the leverage it offers rather than an inability to pay ordinary bills. Look at the big picture. You pay the interest on the debt al right, but then you are gaining higher returns on money you borrowed for an investment.

The rich borrow for the following reasons:

• For the rich, debt is a financial tool
• The rich, essentially invest debt for primary or non primary residences
• They do not cringe at the thought of risk
• They are business men who gained by leveraging debt
• They use bigger debts to grow bigger wealth

We envy their lifestyles and their bank accounts. But if we try, we too can get closer to them in spirit. These people are risk takers that not only own their wealth, debt or no debt but also, know how to treat their wealth and debt with respect.

• They are philanthropists, like Warren Buffet who is donating to Bill Gates foundation
• They run closely held family owned businesses that are a major source of wealth
• They risk, borrow and invest to diversify their business
• They live a very unassuming lifestyle, they do not own fancy cars
• They do not burden themselves with credit card debts, installment debt or auto loans
• They own their homes and investment property
• Most of their wealth is investments
• They never stop buying more homes

Exclusive breed or not, like them, you too can take strategic risks, get into debt, invest, live simple lives, and diversify. You may or may not make it to the Forbes 400 list of the richest as a multi billionaire, but you will never be poor.

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Posted on March 16th, 2009 by CollectionStopper
Filed under: Debt Collection