Recipe For Financial Freedom

Debt! This is the most commonly word used on this blog; I have used it in the context of how to reduce it, effects of debt and in various other forms. Paying off my debt is my number one priority. Debt is not necessarily as bad as I have mentioned before, by definition it is a leverage that you can utilize to enhance your return on investments, provided that the debt is invested and not consumed.

This post is not about debt but about leverage. You would have seen this word ‘leverage’ in many financial books and novels. Some authors have written about leveraging money and some have written about leveraging time. These are primarily called as other people’s money (OPM) and other people’s time (OPT). Today I want to tell you something about leveraging our relationships.

Have a facebook, linkedin, myspace, or orkut profile? Then you know the concept of social networking. If you ask a question “why these sites are so popular?” you would get the answer as “A network of like minded people with similar interests can give you further opportunities in your career”, or “You can remain in touch with those who are close to you but physically distant apart” or you may find some other answer for your question. Nonetheless, you have an online social network.

In today’s world when networking is the happening phenomenon, people are resorting to virtual networks too as in Secondlife.com and There.com. If you go to the conceptual level then you will see that you are forming a community and want to share the relationships in those communities for mutual benefits.

Simply put, you want to use your relationships to improve your life.

The social networks are useful in long term but have you ever used or tried to improve your personal relationships that you created throughout your life? You have a debt of X amount, over which you are paying an interest, can’t you use your existing relationships with your close friends and family and borrow some money from them and pay of the debt. You might say that this would be rolling over your debt but this would be done at a lower interest or no interest (if you are in India).

You can leverage the relationships at workplace too… Ask your colleagues to do some minor works when you are in some work pressure or some deadline has to be met. This would provide efficiency in your work and you would be working as a good team player.

Now you would say that this is OPM and OPT but the underlying fact is that this is neither borrowed money (for which you pay interest) nor outsourced work (you pay for service). It’s just getting things done with your strong relationships. Now you cannot borrow huge amounts but you are borrowing relatively smaller amounts based on the strength of your relationship. Same is true with the work that you will ask from your colleagues.

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