Secret Millionaires Club: Warren Buffett's 26 Secrets to Success in the Business of Life

SECRET #2

Don't Borrow Money

SECRET #2 Think twice before you either borrow money or loan money to someone—especially a friend.

Has anyone ever asked to borrow money from you—or, have you ever wanted to borrow money from another?

A business can get into a lot of trouble if its owners borrow too much money. This is especially true if money is borrowed to help a business grow, but then new sales drop and the company can't pay back its loan.

Borrowing too much money can get people into trouble too. If you borrow money to buy things that you want and don't earn enough money to pay it back, you can get into a big “money mess.”

So remember: The best way to pay back a debt is to never have one.

Jones and Lisa, of Secret Millionaires Club, learned this valuable lesson when the town's local newspaper, THE GAZETTE, was losing readers and almost went out of business.

Of course, Secret Millionaires Club kids wanted to help, and as they were brainstorming different solutions to the newspaper's financial troubles, Jones had a problem of his own. He needed $25 to enter this year's Mega-Monster Skateboard Contest.

Jones went to Radley, Lisa, and Elena for the money, confidently saying he would pay it back from the prize money—after all, he'd won the contest for the past four years.

Lisa agreed ...