When it comes to purchasing vehicles or business equipment, most people follow the traditional route of taking out a bank loan. However, what if there was a smarter way to finance major purchases—one that puts you in control and builds long-term wealth? This is exactly what we explore in the comparison between John and Mike.

At Do Financial, we educate Canadians on how to make smarter financial decisions, and this side-by-side breakdown highlights why borrowing from yourself is a game-changer.

John vs. Mike: A Tale of Two Borrowing Strategies

John’s Traditional Bank Loan Approach

John follows the standard method: he buys a vehicle or business equipment by taking out a loan from a bank. This process comes with some key financial drawbacks:

  • He must go through an invasive bank credit check.
  • He pays a fixed monthly payment of $580 for 60 months.
  • The bank loan contributes to inflation, as money is created through lending.
  • He pays interest to the bank, which increases the total cost of the vehicle.
  • Once the loan is paid off, he is left with only a depreciated vehicle.
  • Over his lifetime, John buys 11 vehicles and ends up with nothing but depreciated assets.

Mike’s Smarter Strategy: Borrowing from Himself

Mike takes a different approach—one that involves leveraging his own capital instead of relying on a bank. Here’s why he comes out ahead:

  • He borrows from himself, avoiding invasive credit checks.
  • His loan payments remain the same as John’s ($580/month for 60 months), but the interest goes back to him.
  • His loan does NOT contribute to inflation.
  • He effectively pays loan interest to himself, allowing his money to continue growing.
  • When the loan is repaid, he is left with both a depreciated vehicle AND his original capital, plus the growth on that capital.
  • Over his lifetime, after buying 11 vehicles, Mike is left with not just depreciated assets but also capital growth amounting to approximately $1.2 million.

Why Borrowing from Yourself is a Game-Changer

By implementing a strategy like Mike’s, you can break free from the traditional banking cycle and: ✔️ Keep control of your money ✔️ Earn interest instead of paying it to the bank ✔️ Avoid unnecessary credit checks ✔️ Reduce inflationary pressures ✔️ Build long-term wealth while still making essential purchases

How Can You Become Like Mike?

At Do Financial, we specialize in strategies that help you take control of your finances, allowing you to borrow from yourself and grow your wealth over time. Whether you're an individual or a business owner, we can help you implement a personalized financial plan that keeps more money in your pocket.

Book a consultation today and start your journey toward financial independence!

Visit us at Do Financial to learn more!