Poor management of debt has killed many good businesses. It is like a drug in that it allows you to postpone the hard decisions too long before you are forced to make them when you run out of credit. I do not recommend funding losses with line of credit financing. It is OK to use lines of credit to fund profitable growth, but the moment you use a line to cover a monthly loss, you have started down a slope that too often ends badly. Make the hard decisions sooner!
The other key about debt is knowing that you can only repay debt with after-tax profits, with very few exceptions. This is a big hit to most entrepreneurs who have a great year and think they can use 100% of all their pre-tax income to pay off debt.
As for term debt, only use this debt when you are purchasing a necessary asset and the payments truly reflect the cost of using that asset over its useful life Newport Cigarettes Coupons.
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