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Thread: Credit Cards or No Credit Cards

  1. #11
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    I think one of the factors to consider is that if you have good credit you can get all kinds of 18 month zero interest rate cash advances. As long as you are confident you can be successful going that route is a good choice. If however what you put on the credit card is going to cost you 18-14% a year I would not recommend that option. It is too easy to just dig yourself a deep hole that will be hard to climb out of.

    I think Fulcrum had some good advice about discounts and cash back cards as well as taking all deductions and watching expenses. It all adds up and can make a really big difference over time.
    Ray Badger, Turbo Technologies, Inc.
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  2. #12
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    I'm not a big fan of credit cards, they tend to cause more harm than good. In a majority of cases it is excessive debt more than lack of income that causes a business to fail. Cutting up our credit cards was the best thing we have ever done both as a business and as a family. That was in spite of the fact we paid them off every month. A vaste majority of people will send more useing cc than debit cards, and more using debit cards than if they pay with cash.

  3. #13
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    Quote Originally Posted by nealrm View Post
    I'm not a big fan of credit cards, they tend to cause more harm than good. In a majority of cases it is excessive debt more than lack of income that causes a business to fail. Cutting up our credit cards was the best thing we have ever done both as a business and as a family. That was in spite of the fact we paid them off every month. A vaste majority of people will send more useing cc than debit cards, and more using debit cards than if they pay with cash.

    I'm with you on that. I understand credit card use by business people who are on expense accounts, are being reimbursed by the company, or are tracking travel and other business related expenses. But I'm totally against spending more money than you have by paying interest and monthly payments on the stuff that you really couldn't afford in the first place.

    I understand emergencies, and who knows...had I had any cards with a large enough line of credit maybe I would have purchased my first office computer and supplies with it. But then what? I wasn't making enough to keep up with the payments that first year...so it would have just created another problem.

    The truth is, you can start most home based businesses for a few grand or even less. If you aren't creative or motivated enough to come up with a few grand just to get off of the ground, then what's going to happen when credit cards are no longer an option?

    Sometimes you can't start with everything. You start however you can, doing whatever you can to bring in money so that you can finance the next thing or the main thing. I started with an old Compaq Presario with 4G RAM that was slow as molasses until I could afford better.

    Too many people have no concept of working their way up. Doing what you have to do to get where you want to be. I don't know anyone who started with all of the equipment that they would have liked to have. Get the most important things first. Bare bones if need be. Get the stuff you WANT later when you can actually afford it.

    This is all just my opinion based on my own experiences. And I'm conscious of that fact that I hate it when people tell me "I did it like this, so you should be able to do it too".

    I just don't think maxing out your credit cards in the spirit of that "do whatever you can to get started" attitude is the best advice unless you have a real plan after that like already have clients and sales in the bag that will pay off that debt. Especially if it's your first rodeo.

    Mitigating debt is kind of a skill. You need a plan that's better than "I hope I make enough to pay this off".

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    I don't know if that could've been said any better Harold.

    How often are we told and taught to just "go for it. Live in the moment and don't concern yourself with the future. If you do good work the money will just come rolling in"? If only they knew the real truth.
    Brad Miedema
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  5. #15
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    This is all such good information, and it's giving me a lot to think about. I'm not ready to jump yet, and I'm working on building up a client list now so when I do jump, I'll at least have a few eggs in different baskets. I also need to think about health insurance, because I have health issues that need to be managed with medication, so that's an issue. I understand it will be ups and downs as far as cash flow, and I think that's one of my main hurdles right now. I've been seriously, seriously broke in my past, like no food in the house and no money to buy more broke and, while I got through it, that definitely wasn't a fun time in my life. So, I guess I need to decide if I can deal with the possibility of that happening again.

  6. #16

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    These are the stories I enjoy most. I don't personally know the struggle. My dad worked as a purchasing agent for large company. My parents used his profit sharing money he'd accumulated over the years to float themselves.

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    Quote Originally Posted by Bobjob View Post
    These are the stories I enjoy most.
    Same here. The stuff that no one talks about. Beyond the romanticized version that you see on TV and in commercials, and articles about successful start ups that go from just a good idea to billionaire without ever tackling the stuff in between.

    I've always been a fan of the "inside scoop" stories. It's better than fiction. I've read more articles about why one company or another failed than I can count. It's where you really learn a lot, if nothing else but what NOT to do.

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    Quote Originally Posted by Harold Mansfield View Post
    Same here. The stuff that no one talks about. Beyond the romanticized version that you see on TV and in commercials, and articles about successful start ups that go from just a good idea to billionaire without ever tackling the stuff in between.

    I've always been a fan of the "inside scoop" stories. It's better than fiction. I've read more articles about why one company or another failed than I can count. It's where you really learn a lot, if nothing else but what NOT to do.
    Yes. I know it sounds bad but also like big heist stories. Back when Tru tv was Court tv they had a show, I believe it was called Criminal Minds, where they told the story of big heists. Wish I owned those episodes.

    I saw a video on inc.com about a girl who had her own business in high school. Then after college she had a startup and investors gave her a couple million. Her startup was failing. But she talked about having a hot tub in her office. I believe this wastefulness is normal for tech business but it wouldn't fly down here.

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    Quote Originally Posted by Bobjob View Post
    Yes. I know it sounds bad but also like big heist stories. Back when Tru tv was Court tv they had a show, I believe it was called Criminal Minds, where they told the story of big heists. Wish I owned those episodes.
    I'm a big fan of the show "American Greed" on CNBC. I'm constantly amazed at the stuff people still fall for, and how blatant some of the criminals are at stealing from them. Most of the schemes aren't complicated at all. Just presenting something to people who want to hear it, taking their money, and then just spending it.

    Quote Originally Posted by Bobjob View Post
    I saw a video on inc.com about a girl who had her own business in high school. Then after college she had a startup and investors gave her a couple million. Her startup was failing. But she talked about having a hot tub in her office. I believe this wastefulness is normal for tech business but it wouldn't fly down here.
    I wouldn't say it's specific to the tech industry, but more specific to a certain age and maturity of the person doing it. I know I'm generalizing, but young people seem to want it all now and many actually think they deserve it for some reason. I remember being young and wanting it, but don't remember feeling a sense of entitlement about it.

  10. #20
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    Keep your expenses low and keep working part time until your business takes off.
    Robert L - www.pikpuk.se
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    Sell your products in Europe with our help!

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