Ever wonder how rich people keep getting richer? One secret: they use loans in smart ways! While most of us borrow money when we're short on cash, wealthy folks use loans as tools to grow their money even more.

Let's look at five clever loan tricks that help the ultra-rich build more wealth.

1. The "Buy, Borrow, Live" Plan

   Rich people often own lots of stocks and mutual fund investments. Instead of selling these (which means paying taxes), they borrow money against them. This gives them cash to spend while their investments keep growing. When they pass away, their family gets the investments without paying taxes on all the growth.

   Real-life example: Mukesh Ambani reportedly keeps much of his wealth in Reliance shares rather than selling them. When he needs funds for new ventures, he can borrow against these shares, letting his ownership in Reliance continue growing in value while he launches new businesses like Jio or Reliance Retail.

2. Playing the Money Game: Borrow Cheap, Earn Big

   The wealthy borrow money at super-low interest rates (because banks love lending to rich people) and then put that cash into investments that pay much higher returns. This is like finding a store that lets you buy something for ₹300 and sell it elsewhere for ₹800. Who wouldn't do that all day long?

   Real-life example: Warren Buffett is famous for this strategy. His company Berkshire Hathaway borrows money at low rates through insurance premiums and bond offerings, then invests in high-growth companies. This is similar to how you might take a loan at 8% interest to fund your startup that could potentially give 30% returns!

3. Credit Lines Backed by Investments

   Rich folks set up special credit lines backed by their mutual fund investment accounts. This means they can get cash whenever they need it without selling their investments. They open credit lines backed by their mutual funds investment accounts, giving them instant cash whenever they want without disturbing their hardworking investments.

   Real-life example: The Hinduja family reportedly maintains flexible credit lines backed by their diverse investment portfolio. Rather than liquidating assets to fund new ventures or personal expenses, they can tap into these credit lines when opportunities arise, like expanding their Hinduja Global Solutions or acquiring new businesses.

4. Using Real Estate as a Cash Machine

   Remember how your parents might have told you that a house is a good investment? Rich people take this to another level! As their properties grow in value, they take out new loans against them. Then they use this cash to buy MORE properties or investments that bring in extra money while keeping all their original properties.

   Real-life example: Ratan Tata and the Tata Group use this strategy with their commercial properties. Instead of selling valuable real estate assets in Mumbai or Delhi, they can finance expansion by borrowing against existing properties. This is like how you might take a loan against your first home to fund a second property that generates rental income while you save for your dream wedding!

5. Growing Business Empires with Other People's Money

   Have you noticed how some business owners seem to open new locations faster than you can count? Here's their secret: they rarely use their own money!

   They use the success of their current business to get loans for expansion. The new locations then earn enough to pay back the loans and create even more profit.

   Real-life example: Kunal Shah, founder of CRED, didn't fund his latest venture entirely with his personal fortune from selling FreeCharge. Like many entrepreneurs, he raised capital from investors and used debt financing to build his business efficiently. Similarly, you could use a loan to fund your higher studies abroad, which could multiply your earning potential when you return with new skills and qualifications!

Lessons Learned from this Story

You don't need billions to use some of these smart moves! The big lesson here is: sometimes borrowing strategically can help your money grow faster.

At Blinkmoney, our mutual fund-backed loans work the same way. With interest rates starting at 9.99%, you can unlock the same “secret sauce” strategies—scaled to your portfolio size.

At Blinkmoney, we bring one of these wealthy tricks to everyone through our mutual fund-backed loans. You can get the cash you need without selling your investments, so your money keeps growing while you handle life's expenses or opportunities.

It's like having your cake and eating it too-without any guilt, but only pleasure!

And not all loans are created equal. There's the kind that drains your wallet (like high-interest credit card debt) and the kind that can actually help build your wealth over time (like loans against mutual funds).

Ready to try one of these wealthy strategies yourself?

Talk to our Blinkmoney team today about how our mutual fund loans can help you borrow smarter and keep your money working harder!