Should you use debt to build your business?
It’s a question that’s surrounded by controversy, especially in our society with its strong anti-debt bias.
Instead, I like to consider the question of disempowered vs. empowered debt. Disempowered debt is using debt to fill a void or to obtain outside validation or gratification, whereas empowered debt is using debt strategically to get you where you want to go, while having a clear plan to pay it off.
If you’re longing to invest in your business but find yourself saying, “I’d love to BUT,” here are 6 questions help you make an decision about whether using empowered debt is right for you:
1. Is there another way to make this investment without going into debt?
There are no shortage of ways to create money. The question is, are you willing? What are your options? Could you ask someone for help, create an offer for your services, or sell something on eBay?
If you absolutely HAD to come up with the amount of money in question, what would you do? (Yes, it’s a question of extremes, but it’s a great way to see what you haven’t been willing to do… yet. Your thoughts, feelings and emotions are not the truth. What action do you really need to take?)
2. Am I letting shame impact this decision?
Because our society places such a negative view on debt, it’s all too easy to make yourself wrong for having it, even if you took it on with your eyes wide open. For many women, being in debt means living with feelings of intense shame and self-judgment – two very difficult places to take resourceful action from.
Notice if you’re letting shame over past debts cloud your vision now. What is the judgment you have of yourself for having that debt? What is another possibility that exists in that story, that is more accurate and empowering?
3. Will I be able to take resourceful action?
Some mentors will ask you to go into debt down to your last dollar, under the guise of overcoming your resistance or creating a breakthrough.
What I’ve found after coaching hundreds of women is that being “on your last nickel” is not a resourceful place to be when building your business. It’s hard to market yourself and take action in a way that attracts clients when you’re constantly worried about your debt.
We all have a tolerance level when it comes to money. Being an entrepreneur WILL stretch your money comfort zone, and that’s a good thing. But you don’t want to be stretched so far that you can’t take action from an empowered place.
Now here’s the key…
If that’s the case for you, instead of saying no outright – simply ask, “How ELSE can I make this happen, in a way that helps me grow?” There is always a way!
4. What’s my plan for paying it off?
Debt can be an excellent tool to build your business, WHEN when you use it consciously and responsibly.
So what’s your plan for paying it off?
For example, if you’re investing in a training program to get clients, decide what portion of each new client fee you’ll set aside to pay off the debt and how long it’ll take. Be realistic about your time frame, so you can honor your commitment to yourself.
This way, you’re going in with a plan and your eyes wide open – by crunching the numbers, you’ll see exactly what you’ll need to do and by when. In many cases, you’ll be happily surprised at how doable it really is, and inspire you to get out there and make it happen.
POWER Tip: As an entrepreneur, your income potential is limited ONLY by your consciousness. So after you’ve crunched the numbers on the investment in question, keep going and see how joining that program or hiring that team can help you create income for the rest of your debt. Create a payment plan now for the full amount of your debt, if you don’t have one already.
5. How will I create accountability?
Whatever your plan, be sure you have a container for accountability – doing the work in your program, using all the program benefits, setting aside the money for repayment, keeping the money shame gremlins at bay, or whatever you need.
As a transformation professional you know that accountability is where it’s at, so be sure to give yourself the same support you would a client.
When It Comes To Your Business, Debt Is A Tool.
Nothing more, nothing less. Don’t let the views of others cloud YOUR vision or make you wrong when it comes to debt.
We bring OUR feelings to money, not the other way around. Which means you can release all the shame, guilt and judgment around the debt you currently have and use these 5 questions to make an empowered decision about whether using debt is right for you.