If you thought you needed to be free of business debt and personal debt before starting your own business, that’s not exactly true. Many business owners have begun a brand-new company even while struggling with student loans or significant medical debts. Here’s what you need to know about business debt and personal debt before launching your startup.

You don’t need to be debt-free

In fact, if you are debt-free, you are one of a very small group of American citizens who is. The average household in the US is burdened with at least three different kinds of debt: credit card debt, student loan debt, and mortgage debt. Chances are, if you wait until all this debt is erased before starting your business, you’ll never even make it to the starting line.

Be aware of your budget

OK, so you’re going to start your business without being completely debt-free. But, that doesn’t mean you should jump right into a business without any cares. You should be very mindful of any previous business debt you carry, as well as any personal debt you have at the moment before you take the leap into a new venture. At the very least, you should be aware of how any profits will be used for your business, and whether they would be reinvested in the company, or whether you’ll have to use them to pay off your personal debt.

Build your business while paying off debt

Assuming you did have some level of debt when you started your business, it’s best to pay down on this debt as best you can once your business is up and running. By taking this approach, you’ll achieve the best of both worlds, in that you won’t be ignoring your debt, but you also won’t be letting it hold you back from achieving business success either.

Is your company stifling under a business debt load? 

If your company is struggling under a load of significant business debts, we might be able to help you get out from under that debt load. Contact us at Prime Wealth Development so we can discuss your situation, and how additional funding might help your company.