Business Education

Why Getting a Bad Credit Loan for Your Small Business Is Usually a Bad Bet

You’ve probably heard the comparison before – starting a small business is like planting a seed. You want it to grow into something strong and successful. But, if you start off on shaky ground, that seed might not sprout at all. Sadly, this analogy has become a cliche, but it’s important to remember most unoriginal phrases were once profound. In other words, such a sentiment, even though overused, hasn’t lost its truth.

Now, let’s apply that lesson to the business world. Meaning, that when you start from a deficit, particularly one that’s so costly, it spells trouble. Applying this reality to entrepreneurship, if you have bad credit, you might think a bad credit loan is your only option. But let’s take a closer look at why this can be a big mistake.

The Heavy Burden of High Interest Rates

When you have bad credit, lenders immediately see you as a risk. So, they often charge sky-high interest rates. Imagine trying to run your business while carrying a heavy backpack filled with rocks. Each month, those interest payments can feel like extra weight on your shoulders. If your business isn’t making enough money, you could end up drowning in debt before you really even get started.

Short-Term Loans with Long-Term Consequences

Many bad credit loans offer quick cash. It sounds tempting, right? But these loans often come with short repayment terms. This means you’ll have to pay back the entire amount in a few months. If your business isn’t booming yet, how will you find the money? It’s akin to sprinting an entire marathon—you’ll tire out well before you reach the finish line.

Limited Funding Options

Using a bad credit loan can also limit your future funding options. When lenders see that you’ve taken on a risky loan, they may hesitate to lend to you again. It’s not much different from getting a bad grade in school. It affects your chances of getting into a better school or program later on. If you need more funds down the line, you might be stuck with few options and more stress.

The Debt Cycle Risk

It’s easy to fall into a debt cycle with a bad credit loan. You borrow money to pay bills, but then you can’t keep up with the payments. So what do you do? You might resort to borrowing again. It’s a slippery slope that makes you a hamster on a wheel, running hard but going nowhere. This can lead to more financial problems in the long run, making it harder to get your business off the ground.

Strained Lender Relationships

Bad credit loans often come with tight terms and conditions. If you miss payments, you will face hefty late fees or even legal action. This creates a stressful relationship between you and the lender. It’s basically the same as working for a boss who’s always watching you, waiting for you to slip up. Wouldn’t you rather have a partnership based on trust instead?

Alternatives that Don’t Break the Bank

While it feels like bad credit limits your options, there are often better choices. Many local organizations and nonprofits offer grants and loans designed for small businesses. These can provide the support you need without the heavy burden of high interest rates. Consider exploring community resources or finding a co-signer with better credit. Think of it as asking a close friend to help you climb a steep hill—you don’t have to do it alone.

Choose Wisely for Your Business

Starting a small business is exciting, but financing it shouldn’t feel like a game of chance. Bad credit loans can seem like an easy fix, but they often lead to more problems. Instead of strapping on a heavy backpack filled with debt, look for lighter, more sustainable ways to fund your dream. Your business deserves a solid foundation, not a shaky one. Select funding options that can help you flourish, not those that will keep you trapped in an endless cycle of debt.

Want to Accomplish More?

Do you want your company to grow faster and earn more while you spend more time with your family doing all the things you started your business to do?

We can make that dream a reality. Give us 30 minutes and we will show you how to get your life back. Skeptical? Good! Put us to the test.

You can call us for your free appointment at 480-636-1720, or, if you prefer, send us an email. You can also visit us at Waters Business Consulting Group to learn more about us and the services we offer.

Like this article?

What the Google Pixel 2 and iPhone X Actually have in Common

October 11, 2017 No Comments

The Google Pixel 2 and iPhone X are certainly receiving a whole lot of media attention. It’s two creative titans battling it out, attempting to win more customers. But, these two companies have quite a bit in common. At least, in one aspect. And, it applies to you as an entrepreneur. What the Google Pixel 2 and iPhone X Actually have in Common What you might think as rivals vying for bigger sales numbers is actually an important business lesson. It’s all about momentum. Keep momentum going and it serves up great rewards. After all, the Google Pixel and Pixel XL were hits. And, we all know the iPhone revolutionized the tech, communications, and entertainment worlds. So, it’s great to take away a valuable lesson from this latest product introduction round. As the momentum starts and objectives are met watch for a change in pace; just like an out-of-shape runner, the tendency for many will be to stop part way up the hill to pat themselves on the back and look at how much distance they’ve covered. Don’t let them stop! You are pushing a rock uphill, as the momentum starts and everyone sees progress you need to double your efforts to keep it moving. —Inc.com You probably know there are many components to running a successful business. That’s certainly no secret. But, specific actions can work wonders. For instance, giving up bad habits and other hangups are prime examples. Another strategy is to get in front of people personally. However, you need momentum to stay on track. How to Keep Momentum Going That’s what the announcement and release of the Google Pixel 2 teaches us. It’s a follow-up, designed to entice consumers. And, it’s generated a whole lot of media buzz. Now, every single thing about it will certainly be poured over by tech lovers. You can apply this lesson to your business. Keep momentum going and reap the rewards by doing the following: Set new goals and objectives. As you hit milestones, dedicate yourself to setting new goals and objectives. Planning ahead means moving forward and that’s a great way to keep momentum working for you. Automate where it is possible. Use automation to your advantage to maximize productivity. Don’t get bogged down where and when it isn’t necessary. You can set content marketing and social media marketing on a schedule, as two examples. Always keep inspiration nearby. Research from Harvard and MIT reveals books are a great source of inspiration. Engaging your brain in something you love breathes inspiration. And, it also increases your knowledge, so it’s two-for-one. Schedule time off and actually use it. Another way to keep momentum going is to take time off. That sounds strange at first but makes a lot of sense when you consider the benefits of rest and relaxation. What ways do you keep momentum going? How do you stay motivated? What methods work best for pushing forward you’ve done? Please share your thoughts and experiences by leaving a comment! Interested in learning more about business? Then just visit Waters Business Consulting Group. [shareaholic app=”follow_buttons” id=”26833294″]

How to Choose the Right Business Bank Account

May 17, 2021 No Comments

The right business bank account can do wonders for any entrepreneur. Whether you’re starting a new venture, are an independent contractor, or just have a side gig, a commercial bank account is generally a very good idea. Not only does it help you separate business transactions from your personal purchases, it can also serve as legal protection. So, read on to learn more about how to choose the right business bank account. Top Business Bank Account Benefits A commercial bank account makes it a cinch to tracking business expenses. You can monitor spending with ease. Plus, it can also be a big help in preventing overspending. What’s more, having a dedicated business account will be a huge time-saver come tax time (which can be every quarter, by the way). Business checking accounts can make it easier to separate business spending from personal spending. If you run a small business, are self-employed or earn money as an independent contractor or gig worker, a business checking account is something you may need. But which one is best for you? Just as with personal checking accounts, choosing a business bank account comes down to finding one that offers the right combination of features, benefits and cost. —Forbes.com Additionally, a business bank account makes your organization look more professional. This, not to mention you can also usually enjoy some personalized and professional services of your own. For instance, having documents notarized for free or a minimal fee. Or, helping you to choose the right business credit card and/or debit card. How to Choose the Right Business Bank Account Unfortunately, choosing the right business bank account can also be a bit intimidating. After all, you want to get the most out of it while paying the least (since practically all commercial accounts charge fees). So, here are a few helpful tips to find the best business bank account: Ask about fees and requirements. There are very few business bank accounts without fees and requirements. But, some financial institutions waive one or more fees if the account continually maintains a certain minimal balance and/or has a number of business transactions. Know not all introductory offers are the same. Some banks offer very tempting introductory offers. Of course, these expire, so you want to make sure you understand the exact terms. Moreover, pay close attention to what occurs thereafter because it might well be a lot more trouble than it’s worth. Do your homework. Of course, you can always get recommendations from other businesses. But, don’t just go on their experiences alone. Take some time to research different banks online and see how they perform with the Better Business Bureau. Commercial customer reviews could also tell you a whole lot about how a bank treats its business customers. Compare and contrast. Obviously, you’ll need to stack your possible options up against one another. While one might charge a bit more in fees, it could offer waivers. Or, you could value having several branches because it’s more conducive to your business’ needs. Be sure to go over the pros and cons of each to decide which is the best overall fit. What other suggestions do you have in selecting a good business bank account? Please share your thoughts and experiences so others can benefit from your unique perspective! Interested in learning more about business? Then just visit Waters Business Consulting Group.

4 Foolproof Ways to Write Better Emails

March 23, 2018 No Comments

If you’re in business, regardless of your role, you need to know how to write good email. Let’s face it, email isn’t going away any time soon. We use it on a daily basis. And, it’s a great way to communicate on-the-fly. It also helps make organization easier. This technology is an effective one — if you use it right. The trouble is, too many people just don’t write good email. But, don’t worry, it’s super-easy to improve by leaps-and-bounds. In Business, Electronic Communication is Key There’s no getting around the fact that email is a critical business tool. It can easily be used for more than just day-to-day communication. After all, like social media, it’s also a powerful marketing tool. That’s why there is a bazillion email newsletter templates floating out there in cyberspace. Make no mistake about it, communication is key in business and email should make it all the more easy. The ubiquity of e-mail means that everyone in business, from lords of finance to programmers who dream in code, needs to write intelligently. By using simple, clear, precise language, and following a few other basic writing rules, you can become a better communicator and improve the prospects for your career. —Forbes.com The problem is, far too many people just don’t use it in the most practical manner. Now, that doesn’t mean every single message needs to actually be a work of art. But, it does mean, the more you make a habit of some good practices, the better you’ll become over time. 4 Foolproof Ways to Write Better Emails We all like the notion of “inbox zero.” That place where we’ve gone through every message and taken the appropriate actions. But, with so much, it’s often difficult to get to every single message. And, it’s even more difficult to write in a way that makes the most out of the medium. So, here are four foolproof ways to write better emails: Keep it short. There’s no need to go into painstaking detail. The longer the message, the less effective it becomes. You need to deliver your message in a quick manner so it doesn’t waste the recipient’s precious time. Always be direct. Limit the adverbs and adjectives. Keep them to a minimum because the more “flowery” the wording, the less clear (or boring) it is to the reader. Now, you can explain but be direct. Army service members call this strategy “BLUF”, which simply means “bottom-line, upfront.” Reread your message. Never hit “Send” without re-reading your message — at least twice. Don’t rush through it. Take advantage of the spell check and ask yourself if it gets your meaning across. Add the recipient(s) last. When you compose a message, be sure to leave the recipient field blank. And, don’t add his or her email address until you’ve written it entirely, and reviewed it twice. This way, you’ll avoid sending it out accidentally with errors (or without being clear). What other suggestions do you have for writing good email messages? Please, share your thoughts and experiences by commenting! Interested in learning more about business? Then just visit Waters Business Consulting Group.