The Power of Leverage
Last Updated on 21 October 2020
In today’s modern, Leverage is happening everywhere. Most of us know about the leverage, but we never know how to put the leverage in the right use. The right use of leverage can make you be wealthier or it can make you more poor. It’s perilous if you don’t know what you are doing when using the leverage. In this blog, I’m going to talk about the power of leverage. So, what is leverage?
What is Leverage? Why We Should Use Leverage?
Leverage is power and they can be happened anywhere when load, fulcrum and force is exist. In finance, the leverage is a technique that amplifies investor profits or losses. We commonly used to lend money to achieve to magnify profit potential for you to grow faster.
The reason human are better than animals because human know to use leverage but animals don’t. In beginning animals are better than humans, but with good use of leverage, we can fly higher than birds, moves faster than animals. In our daily life, we use the leverage on the bicycle, motorbike, cars, trains, airplane and many transportation tools as a leverage tool. Today’s, we use the computer and internet to communicating, shopping, running business and many more. It could saved us a tons of time and money with lesser effort and cost.
However, there are some disadvantage of using leverage. If you are using leverage for borrow money to magnify your profit, it may also potential scale of your loss. Too much leverage can be bad, it may easily get you into bankruptcy because the losses can exceed your deposit. When you use the leverage tool, you are responsible to know what you’re doing when using it.
Methods Of Leverage (Ideas)
- OPM ( Other People’s Money )
Eg: Borrow Money from Bank, Looking For Investor Or Sponsor.
The concept is simple: You (as an individual or business entity) acquire or build income-producing assets-your business-by using money from sources other than your own.
- OPT, OPW, OPE, OPI ( Other People’s Time, Work, Experience, Ideas)
Eg: Hire Professional to Work For You.
The concept is to effective use, to spend your time in the important things, not in trivial matters
- Health (Long Term Leverage)
Eg: Exercise Consistency, Eating Health Food.
When you in good health, you saved the time to visit the doctor, suffering in disease, time to recovery, money and many more. So, you can have a better body condition to concentrate on the important thing. In the beginning it may consume your energy, but in the long run it’s a good leverage that worth a lot more than you invested.
- Education (Long Term Leverage)
Eg: Reading Books, Learn New Things, Self-Improvement
The concept is to improve yourself with education. It may cost a lot in beginning, but in long run it will be worth it.
- Time (Good timing, Right Time)
Eg: Analysis of The Future Trends
The concept is to entering anything in the right time. It’s a very good leverage if you know when it the good timing to perform something.
- Social Network Leverage (Business Related Leverage)
Eg: One friend introduce Two, And Two to Four Or Even more
The social network is a very strong power, use the social network to expand it it very important. Look at the trend today, if you have a good content that are posted in the right item. The social sharing in internet can start from 10 to 100, 100 to 1000 even to shared by a million in a day.
- The Mentality (Mindset Leverage) – The way you think (I can’t afford it, how can I afford it)
Eg: Achieve More With Less, Stay Possitive
The concept is the way you think it’s affect your emotional and reaction. A good mindset will bring you to the best mode to the success. Consistency in good mindset and discipline will bring you a good difference.
The Future of Leverage
But in nearly this 5 years, I believe the OPD(Other People’s Data) and OPAI(Other People’s Artificial Intelligence) will be the trends or future leveraging tool. We are not going to create own data and artificial tools, but we will utilize what in the market and other people’s have to leverage it and helping our business.
What do you think about the future of leverage tools? Leave a comment on below, let’s discuss!