Don't Do Small Business With Credit Card Debt
Scott has $142,000 in credit card debt after fronting it for a business. The business is struggling. Do they start choosing who they're going to pay using his wife's income?
QUESTION: Scott in Birmingham has $142,000 in credit card debt after fronting it for a business as a major owner. The business is slowly growing, but the sales season is autumn, and they’re struggling. Do they start choosing who they’re going to pay at this point using his wife’s income? Dave doesn’t think he has any other choice.
ANSWER: You don’t have the money to pay everybody. If you don’t have the money to pay everybody, you’ve got to choose who doesn’t get paid. What would I do? If you still believe this business is going to turn and the seasonal kick in the fall is going to bail you out and then some, is it worth it to get behind for a few months on some things to see your dream unfold? Yes. If it’s going to become a nightmare, no. But this time, your projections have got to be right. You are a walking case study of why you don’t do small business with credit card debt—ever—under any circumstances. There are no exceptions.