Been there, done that. Got the T-Shirt and High Blood Pressure.

Business owners, your “prestigious” credit card is not a status symbol, it’s an idiot symbol.
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In business debt, that is. I was dumb. Business debt is plain dumb. And business credit cards…oh don’t get me started.

Well, I just started, so here goes.

I logged into LinkedIn a few weeks ago only to see an advertisement with a smiling small business owner claiming that he owed his business success to the credit card company doing the advertising. WHAT?!?!

I’m not going to call out the company, but let’s just say their name rhymes with “city tank.” The ad was laughable, sad, and fury-inducing all in one pinwheel of emotions.

They are trying to convince me that this card, with all of its fancy perks and rewards is the reason why Joe transformed his business from a two-person startup to a multi-million dollar empire. A card. A piece of plastic that magically loans me money I don’t have and asks for nothing other than a 84% interest rate and the naming of my first-born child. That is how Joe built his business!

Really? Have you ever heard a great entrepreneurial business leader like Steve Jobs, Bill Gates, or Richard Branson say “You know, some might say that our success was due to my visionary leadership, our great people, or our uncompromising dedication to our principles, but they would be wrong. It was absolutely due to the triple points we got with our Rainbow Business Card.”


I beg you, if you are a business owner, do not fall for this lie. It’s a trap. Businesses are not built on the backs of American Express and Visa. And the Plum/Mango/Passion Fruit card is not a status symbol; it’s a symbol of idiocy. It’s only a blatantly obvious sign that you have borrowed and paid off too much money and have the gray hair to prove it.

So please, dear business owner, don’t believe the advertising. Build your business on cash. If you have not already, read Dave Ramsey’s book EntreLeadership, which does a much better job than I can of outlining exactly how to do this (Spoiler Alert: It involves a lot of common sense, math, and wearing of big boy pants.).

Have you built a debt-free business? If so, how did you avoid the lies and myths of needing debt or fancy credit cards?

15 thoughts on “Business Debt is Dumb

  1. Lily Kreitinger says:

    Any kind of debt is dumb, I think. The same principles applied to personal finances should apply to business: don’t spend more than you make, pay cash, grow slow, work hard. My dad lost everything (including his health) to owning a business and the debt that went into that . Very painful and definitely not worth it!

    1. Todd Liles says:

      I agree. Be happy. Be debt free. Make money, give money, be thankful for your health.

    2. Matt McWilliams says:

      Wow. That is a powerful testimony to the negative power of debt…in business and in general. Everything, including your health, becomes a slave to the debt.

  2. Todd Liles says:

    My business is debt free. I did it by sacrificing the first year. Very low pay, 100% of retained earnings went back into the business. This year will start the 3rd full business year. We are debt free, blessed, and growing. My family is also now earning a wonderful living on the income of our debt free, cash flow positive business. Praise God.

    1. Matt McWilliams says:

      Yeah buddy. You lived like no one else so that only two years later you could live like no one else!

      1. Todd Liles says:

        Love that Dave Ramsey!

        ——– Original message ——–

  3. Dan Black says:

    I think it’s wise to run a debt free business. At some point in the future I plan on writing and speaking full time and plan on running my business debt free. I’m a huge fan of Dave Ramsey and listen to his podcast a few times each week. He is full of wisdom and insights into the financial freedom world.

  4. Jon Stolpe says:

    I’m anxious to read Dave Ramsey’s book. I don’t know if I’ll ever own my own business, but I’m all about becoming debt free in every area of our lives.

    1. Matt McWilliams says:

      If you don’t mine me asking Jon, why not?

      1. Jon Stolpe says:

        Good question. I’m not 100% sure…the risk…the pressure…the added pressure to perform. But I could see how this could easily be reversed as well…the freedom…the opportunity to be creative…the challenge…the chance to break away from the handcuffs of corporate America. Maybe I’ll have to reconsider. What reasons would you give for owning your own business?

      2. Matt McWilliams says:

        I would encourage you not to rule it out, that is for sure.


        1. No income ceiling.
        2. Freedom.
        3. Better stress. At least if you start it debt-free and keep it that way. The stress is different…it’s better…I can’t describe it though…it’s just better. The lows are higher.
        4. The highs are higher. When you succeed, YOU succeed.

        Don’t ever rule it out man. Keep it in the back of your mind at least.

      3. Jon Stolpe says:

        Thanks for the added feedback, Matt. I won’t rule it out. Do you have any recommendations for making the transition from the corporate world to owning your own business?

      4. Matt McWilliams says:

        Jon Acuff’s book Quitter has an interesting perspective and I highly recommend it.

        Gerber’s book the E-Myth is also a must-read. And of course EntreLeadership.

        Other than those, I would recommend some rather obvious things now…

        Kick butt as a leader in corporate world

        Learn all that you can

        Study entrepreneurship

        Start meeting with other entrepreneurs if you can

        Start something small on the side. A landscaping company, a painting company, a consulting company. Anything. Something that forces you to learn accounting, sales, marketing, etc. and at some point possible even hiring hiring part-time help. Go part-time first. You can also do multiple things in this realm. Start something and don’t like it? Who cares. Start something else.

        Network like crazy. I mean become a networking fool. Not only will you build a support network, you will have connections for the future, possible team members, possibly investors (if that is something you want to do), and possible job offers in the meantime.

      5. Jon Stolpe says:

        Great advice, Matt. Thank you!

      6. CabinetDoork says:


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