By Bizna Brand Analyst
We live in a huge debt society and it’s no wonder that so many businesses are created with the same model of taking loans to get start-up capital. Here are some myths about going into debt while starting a business
1.Debt is a must to start any business
- Debt is a great tool to get some good cash early
- Debt when used correctly is a great way to go
- Debt is okay because you’re going to instantly start making money back through the business.
- Debt is a must to keep full equity of your business
These are all myths that must be bust in your mind and how you think about debt. Once you get the facts start within your mind, you will quickly understand the same advice that you probably heard for years if not your entire life doesn’t always work.
So here are some simple traits that people have used for decades to keep businesses out of debt.
They are goal-driven.
This one might be a no brainer. It’s true someone starting a business must be goal driven to do it without debt. It can be done; you just have to have a plan and goals. Here is the kicker though these people do more than just set goals; they completely map out each step of the way of how to get there. It takes a ton of baby steps and a lot of trial and error to accomplish a debt-free business.
They endure struggles.
Within business comes struggles, and being able to cope and work through struggles is a must. Someone that truly had the entrepreneurship mind will know what it takes to get through struggles and still come out on the right side of it making money or more money from the experience.
They are convinced it will work.
People who have lived or done business with cash only methods know it works. Once they experience that feeling of not worrying to pay someone back or the pressure to have to cut something because you don’t have the money for it, they stick to it. They know it works, and they are excited to continue to carry out business the best way to do so with the money on hand and not borrowed money.
They are accountable.
Staying and/or getting out of any financial mess takes a lot of accountability. Remember you even if you’re the boss, CEO, or founder whatever your title is you still must be accountable for your spending and telling the money where it’s going. Being able to have a solid accountability from the start with every dollar that is being spent is a must to be successful and start having a cash flowing business right away.
They are not materialistic.
The main reason to become a debt free business is to be able to expand and grow in a healthy way. This would be by adding more employees that you could pay a fair amount to and keep them motivated, to change lives, and perspectives while working with them. Materialism is not the focus, and can affect anyone not matter the amount of money coming in. It comes down to how important is it to you has a person. The stats show the most debt free business owners could care less about more possession or even money.
They are willing to cut out unnecessary expenses.
Lunch meetings, buying extra, over spending on resources, and the list and go on. This type of person knows what he has and is willing to cut off just about anything to keep himself or his business within budget. These are the type of things that many companies can get away with when they are not meeting their budget and going into debt. Remember that budget cuts are only temporary. The best part is when you’re business becomes cash flowing you can slowly start adding more of those unnecessary perks back into your budget if you would like.
The conclusion is? You have choices, and you can choose to live or do business with debt or without debt. You have to become motivated and want it very badly to become a debt free business. Continue to work at it over the long haul.
Don’t ever say that you cannot get out of debt, or that you have too much that you owe. Even if you don’t have any of the above traits, you will be surprised at how much you can accomplish when you fully come to understand the right perception of wanting versus needing.