If you are not planning to succeed, then you are planning to fail. The young ones say, “You only live once” (YOLO) but when it comes to taking loans from financial institutions, things are different.
Never take a loan if you don’t have a plan. First, it is important to realize that cash taken as a “loan” is not your money. It will never be your money. You are borrowing money that you will have to pay back with interest.
It makes no sense to walk into a financial institution, deposit your collateral and secure a loan with no plan on how or where to invest or how you plan to pay back.
There are 4 questions that you must answer before taking a loan from any financial institution in Kenya:
Why do you want the loan? This should be the first question. Interrogate yourself. Do you need a loan? Why? Do you have a plan? Do you have plans to pay it back on time?
Where do you want to secure your loan from? Are you planning to get your loan from a commercial bank, a digital lender, or a Shylock? If you must have that loan, avoid shortcuts and go for the mainstream banking system.
When do you want the loan? This is about the timelines that you want to secure the loan. This will help you plan beforehand so that when you finally get the loan, you have systems running and ready to invest.
How do you plan to repay the loan? Take a loan with the payment date in mind. Sometimes money can make you lose track of time. Before taking a loan, you must have a clear roadmap on how you plan to start paying back.
A loan makes you a slave to the lender. If you do not have a plan, you will never know peace.