Debt can be seen as a sum of money that is owed or a feeling of gratitude for a favor or a service rendered.
It is only normal for businesses to owe. At the beginning of a business, entrepreneurs borrow or take a loan to start up their business or at some point, especially when things get rough in business, money has to be borrowed in order not to go on liquidation. At some point of expansion, most business owners have to borrow to expand as required.
Most times, entrepreneurs just have to borrow without a choice. In fact, they always need friends, family and the banks to borrow from and because of this “must-do” as an entrepreneur, do not forget these:
As an entrepreneur, investing in yourself when it comes to credibility is of paramount importance. Be trusted. Be sure family, friends and colleagues are able to trust in you especially when it comes to money matters. Do not spoil relationships especially not because of money issues. Refund when you should and if it is not possible, plead for an extension of payment.
Diversify in business. Yes, invest in other things such as properties, stocks, bonds, etc. If one does not work, the other will, this helps in having some money saved up somewhere and can be used to sort out a financial need of your business or to pay up debts.
Never forget to save up. Always put something aside at the end of each month. It does not necessarily need to be much, just save something from the little you earned or large from the large you earned no matter what. Savings help reduce the chances of borrowing and been labeled a debtor.
If you are single, yes I mean not married, this is important to you. Marry someone of your choice as per how he/she would affect your personal and business life. Your goals should be on the same lane. Finance should be appropriately discussed before marriage. In fact, sometime ago, I saw this “if you dey give your babe N2000 to fix and polish nails, abeg leave am, a bucket of paint costs N1,800”…lol, funny but true. Be specific about finances and this goes a long way in building up your business.
Always remember to separate your personal finances from your company’s finance. Maintain separate accounts for your business. In fact, put yourself in your company’s payroll, so you do not have to always take from the company’s finance because this drains and can kill the business. Advantage is, from the company’s finance, you can always save up to pay debts borrowed for its growth.
As an entrepreneur, you need to seek legal advice for your business, as per loan, beneficiaries, investment, insurance and lots more. Good advices put you and your business on the right track.
Adequate insurance will protect company’s assets, your health and everything you have from accidents. Unforeseen occurrences befall us all. Get insured, so you do not end up in debt.
Become a philanthropist. Yes, this habit does not happen overnight but if you love what you do, become a giver. Give back to the society, your community and Nigeria at large. You can pick an area to work on/with based on the UN sustainable development goals. Do not forget the popular saying, which is usually correct, “givers never lack”. When you always give, you are sure to always receive.
The beneficiaries for your assets should be stated especially as the head of your family or bread winner of the family. Be sure to fix this as soon as your business stands. Get it documented, if you want it sold or if you would be giving it to someone/people.
As ugly and fearful as death can be, we all have to face it. Hence, get prepared by putting down a will, especially as you start having children. No one wants their labor to fade away even when they are gone, hence have a will for who would have your business when you are no longer around(this might necessarily not be your family but someone you are sure has the same interest as you for your business to stay alive). Make sure to give necessary information about debts owed to whoever will become your successor. Until when this ugly enemy to humanity comes, your lifestyle is important. Take care of what and how you eat, exercise regularly, do not always be too anxious over everything, learn to be happy at all times, keep good friends, be spiritual and learn to sleep well as you work hard.
The concealed truth is even big businesses borrow to do business and stay alive. If you are in doubt, name one and make a research about them. It is very obvious that we cannot have it all, yes, not even all the money but as the saying goes, “he who fails to plan, plans to fail”. Get it right.
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Gary Crenshaw douglasville, ga. February 26, 2016
It is normal for businesses to owe money at the beginning of a business. That's what separates entrepreneur from the rest of us. Entrepreneurs are not afraid to owe money. They are not afraid of investing someone's else's money also. To live your dream, it takes money, vision, and a willingness to go in debt.