Is the Weight of Business Credit Debt Too Risky?

Have you ever worried that financing or carrying business credit debt is too risky for your company?

If so, we understand exactly how you feel.

Years ago, one of our students had just dug himself out of $69,900 of business credit debt. And he did it the hard way – no negotiating payment terms, no re-financing, no help from friends or family…

…just the old fashioned save it and pay it method. It was grueling but he managed to pay every penny back…

After that though, he was almost scared to use credit cards or accumulate ANY DEBT…

While we understand where he was coming from, he limited not only his spending – but also the rate at which he was able to grow his business.

He basically stopped all marketing efforts because he was terrified of falling into that much debt again…

Needless to say – his business suffered SEVERELY!

After a few months, he knew something had to change… He couldn’t keep being a tightwad if he hoped to grow a thriving business.

That’s when he came to us for help…

We introduced him to the concept of using a separate business credit profile to ‘go straight to the money’. Now he runs a multi-million-dollar business – and as they say…the rest is history.

Corporate Credit Myth – ‘Financing & business credit debt is too risky.’

It’s true that securing financing, but that doesn’t mean you have to avoid it altogether…

There’s Bad Business Credit Debt and Good Business Debt.

Bad debt is money spent on things that aren’t going to help boost your business revenue. Or, things that will significantly decrease in value (to the point you won’t be able to recover the original cost.)

Good debt is money spent on things that will lead to more revenue coming into the business. i.e. purchasing inventory, advertising, etc.

While there are entrepreneurs out there that have successfully built their companies by ‘bootstrapping it’ – it doesn’t work like that for most of us…

Plus, you may not know this but many of the ‘bootstrap’ companies you hear about were self-funded from the profits of previously established businesses these entrepreneurs owned.

Smart entrepreneurs make good use of everything at their disposal, including utilizing corporate credit.

After all, it’s a good idea to have backup funds ready to keep your business running if/when the need arises, isn’t it? It just means you just may need to be more choosey with the types of lending offers you accept.

It’s a much better idea to have available credit for your business and not need it, then to wait until you need it and scramble to get whatever is left. 

Being proactive and making your business credit a priority, puts you in control. It also opens up more financing options down the road so you have more choices and lower rates to choose from.

Smart Entrepreneurs Always…

• Separate business and personal finances
• KNOW THEIR NUMBERS! A good business owner calculates all costs down to the penny, knows profit margins, sales figures, the interest rate for each credit account, etc. You should know your total debt and cash flow situation. Even if you have a book-keeper you should know your numbers, without this – you could have a million-dollar business and still be broke as a joke.
• Have a business budget & accounting system and use it!
• Establish a credit profile with each of the business credit bureaus
• Shop around for the best credit options based on needs & budget
• Obtain credit WITHOUT a personal guarantee whenever possible!
• Make their business credit a priority
• Work to increase profit margins – money’s the lifeblood of a business!
• Pay all bills on time (even if it has to be the minimum payment)
• Finding ways to ensure their customers make payment on time
• Make sure all credit accounts are getting reported to the bureaus
• Don’t use too much of their credit at a time without paying it back
• Maintain a good credit score by keeping their credit reports in check.

Business credit debt can be good as long as it’s used for things that will improve the cashflow of your company overall.

Strong Corporate Credit can be the bridge to take you from where you are, to where you want to go –

If you’re worried about getting in over your head with business credit debt, there’s no smarter way to learn the process than Corporate Credit Secrets!

We’ll show you how to establish a new business, how to find the right banks and lenders for your business, how to get established with the business credit bureaus, tips to improve your personal credit and all the tips & tricks we’ve learned to get approvals for high-limit credit and financing. We’ll even briefly go over how to manage your business finances so you can track what’s going on.

Learn More About Corporate Credit Secrets

There’s one business credit step everyone tries to SKIP over – we’ll reveal the truth tomorrow. Lookout for our new post.

Your friends in finance,
Private Wealth Academy