Wednesday, November 14, 2012

Why borrowing is not a good thing.


Far too many businesses are relying on large scale credit from the Bank. The days when credit was considered to be a short-term back-up have unfortunately gone.

This comes at a cost. What most people don’t realise is that all these amounts of debt and interest are paid by all of us – the consumers. The consequence of this is that everything we buy comes at a premium. Our cost of living would be a lot less if we weren’t financing the Banks by the back door.

Don’t be in a rush to borrow money to fund your project.

By borrowing money the economy is spiralling out of your control. Every business currently in debt to the Banks realises the truth. The deeper your debt the less control you have over your business. When there is a downturn in the economy you are limited in what you can do to survive it. Your debt is still hanging round your neck. You can’t get rid of it and the Banks stop lending so you can’t expand to cover the extra money you need to expand.

Result. Very, very hard times, catastrophic reduction of your available products possibly ending in bankruptcy.

The way forward is not expansion into larger and larger businesses. The stability of our future lies in the entrepreneurs who are prepared to start small and concentrate on building up finances and developing at a realistic speed according to what the market requires. A small business can change direction, alter marketing methods, etc. at speed. Overheads are more manageable. Economies can be without the dead weight of debt hanging overhead.

The person who has this control over the business is in a position to develop as far as he or she wants. The choice to remain as a small one-person or family affair or to develop to any level up to an international company is not controlled by the millstone of debt.

Successful entrepreneurs are willing to take on work that they normally wouldn’t consider to build up the finance they need to get started. They don’t spend time feathering the nests of bankers with great dollops of interest.

Once you are in the clutches of debt it is very difficult to extricate yourself but it can be done.

The ‘Show Me Financial Freedom – The Key to Success’ is a series of inexpensive Ebooklets available from Amazon which offer helpful suggestions on starting up small businesses with little or no outlay.

The first two are already available. These are ‘Easy Ways to Make Money From Car Boot Sales and Markets’ and ‘Twelve Easy Ways to Make Money With Your Camera’ both by Lesley Cooper.


Theodora is has produced a programme to help new entrepreneurs find a business that suits them. It also will give existing entrepreneurs the opportunity to extend their businesses or find new financial mountains to climb Show Me Financial Freedom