How To Tackle Business Debt
Debt is something that the majority of us will face at some point in our lives, but the key to becoming successful in life and in business is in how you tackle that debt. Debt is your worst enemy, a constant source of stress and anxiety that will drain you financially, as well as emotionally. There is no such thing as good debt because all debt comes with risk; and unfortunately, in many cases, people don’t see that risk until it is too late. The average household debt in Canada is at an all-time high, so it is something as a nation that needs to be tackled.
This article will give you some ideas and methods as to how to tackle your debt; however, if you are having sleepless nights and are unsure where to turn to, it might be worth seeking professional help from an insolvency expert.
One insolvency client said, “Visiting an insolvency expert was the best thing we ever did. Talking to someone who was removed from the situation and could offer clear impartial advice helped ease our stress levels, and it felt like we were finally taking positive action.”
According to Sheriff Sole & Madej Inc, discussing your situation with an expert will give you the opportunity to understand all of your options and make an informed decision, rather than hiding your head in the sand. Visiting an insolvency expert doesn’t mean that you have to file bankruptcy, but it will help you to make the most appropriate decision.
How To Tackle Your Debt Head On
- Be Ruthless - When it comes to tackling debt, you have to be 100 percent focused and dedicated to the cause. Debt is your enemy and cannot be taken Evaluate every part of your spending and be ruthless, cutting away anything that is not essential.
- Never Add To Your Debt – You cannot spend your way out of debt, so whatever you do, do not be tempted to spend more money or look at opportunities that seem too good to be true in desperation. When you are so focused and worried about your debt, you are much more likely to make flawed decisions, which will more often than not exacerbate the situation rather than improve it.
- Consider A Second Stream Of Income – This is not a long-term strategy, but sometimes you might have an income problem versus an outgoing problem. In other words, you cannot cut down your spending any further, so you need to tackle the other side of the equation. As Dave Ramsey, a financial expert, would say, “Get out there delivering pizzas.” Getting your cash flow up might give you the breathing space for your main business to grow and blossom. By throwing every extra cent from your second job at the debt, you will be surprised how quickly you can gain some traction.
- Sell Some Of Your Assets – Take a harsh and honest look at the items you and your business personally own. If they are not earning the business money, then they need to be sold. Desperate times calls for desperate measures, and you need to eliminate your debt as quickly as possible.
All of the above pieces of advice apply equally to both business and personal finances. Debt repayments take away your main opportunity to earn when the majority of your income is spent on debt repayment. If you need physical evidence of that, look at the buildings the banks own and ask yourself who paid for those.