Register free!
Search
 
     

The Green Industry's Resource Center


Click for Weather
Closed Thread
 
Thread Tools Display Modes
  #11  
Old 07-05-2013, 06:56 PM
larryinalabama larryinalabama is online now
LawnSite Fanatic
 
Join Date: Jan 2008
Location: Ragland Al
Posts: 10,022
Quote:
Originally Posted by seabee24 View Post
Good debt- you have the money to pay for it cash or most of it cash but rather than clearing out your bank accounts for the purchase to leave you with liquid funds to spare which can be used for other savings in business like bulk discounts, or time/labor saving tactics.
Posted via Mobile Device
Good debt is what your compedators have.

In reality there is no good debt in this business, debt increases your risk of failure, debt is expensive, and debt on a asset that is going down in value is extremely expensive.

Too me a lawn mower payment doesn't even sound right.
  #12  
Old 07-05-2013, 07:01 PM
JB1's Avatar
JB1 JB1 is online now
LawnSite Fanatic
 
Join Date: Feb 2000
Location: From the hills of beautiful Southern Indiana
Posts: 5,820
Quote:
Originally Posted by larryinalabama View Post
Good debt is what your compedators have.

In reality there is no good debt in this business, debt increases your risk of failure, debt is expensive, and debt on a asset that is going down in value is extremely expensive.

Too me a lawn mower payment doesn't even sound right.

neither does a house or anything else then according to your logic.
__________________
  #13  
Old 07-05-2013, 07:33 PM
larryinalabama larryinalabama is online now
LawnSite Fanatic
 
Join Date: Jan 2008
Location: Ragland Al
Posts: 10,022
Quote:
Originally Posted by JB1 View Post
neither does a house or anything else then according to your logic.
A house or "realestate" in general is an asset that goes up in value, a truck or lawnmower is an asset that will almost alaways go down in value.

If you need to have a home mortgague it may or may not be better than paying rent. If you choose to borrow make darn sure its something you can easily afford and pay off in 7 to 10 years.

I used to leverage some realestate. I never borrowed on any deal that wasn't 60% instant equity. Even those deals are long term and its a real tough business. Cash is alaways better, it save a whole lot of money in fees as well as interest, and keep the properties 100% in your control.
  #14  
Old 07-05-2013, 07:57 PM
Efficiency's Avatar
Efficiency Efficiency is offline
LawnSite Bronze Member
 
Join Date: Apr 2011
Location: zone 6
Posts: 1,014
Quote:
Originally Posted by seabee24 View Post
3. Can I stop all operations, stop working, and make all my current fixed payments plus this new
Posted via Mobile Device
WTH? That question isnt even logical. if you stop operations, you will next liquidate all assets, pay off any associated notes, and problem solved, assumimg you dont sell operations and assets as a whole (massively prefered/advised)
Posted via Mobile Device
  #15  
Old 07-06-2013, 12:29 AM
vegandude's Avatar
vegandude vegandude is offline
LawnSite Senior Member
 
Join Date: May 2013
Location: eastern wa
Posts: 430
How much per month can you pay your bank account to save up for it, or is it a immediate need? I don't know if your solo or not but, one injury can screw you over. NO DEBT. NO DEBT. NO DEBT.
  #16  
Old 07-06-2013, 04:55 AM
32vld 32vld is offline
LawnSite Gold Member
 
Join Date: Feb 2011
Location: LI NY
Posts: 3,065
Quote:
Originally Posted by monoshock View Post
Maybe get a cheaper used truck. Just an idea.
I haven't had a car/truck payment in over 35 years.
I couldn't imagine paying $600 a month.
Quote:
Originally Posted by larryinalabama View Post
In my opinion debt is dumb, especially when used to cut grass.

A 600$ per month truck is a redicilouse purchase to use in this business.

I have leveraged some debt in the past for my realestate business, but seldome do anymore. Im currently looking at a house that Im 7k short on the deal and may not due it, that's how sick of debt ive become.
I am not buying a truck. The numbers were an example to start a discussion. The thread is not about how much to spend on a truck.
  #17  
Old 07-06-2013, 05:11 AM
32vld 32vld is offline
LawnSite Gold Member
 
Join Date: Feb 2011
Location: LI NY
Posts: 3,065
I am not buying a truck. The numbers were an example to start a discussion. The thread is not about how much to spend on a truck.

I prefer saving and then buying with cash.

Though I could see one being caught with not enough money to make a major purchase such as a truck or even a major repair such as a blown transmission. Yes there are always options. Buy a new truck or just drop in a new motor into your current one is one example.
  #18  
Old 07-06-2013, 06:20 AM
32vld 32vld is offline
LawnSite Gold Member
 
Join Date: Feb 2011
Location: LI NY
Posts: 3,065
I am 59, and I am paying off a mortgage. Out side of that I do not want to take on any more debt.

At 59 I do not have the income and financial security to take on loans even for a car or truck.

I want to avoid debt because at my age I have know idea many more years I will be able to do this work.

I have seen too many businesses just on lawnsite go under because of being in debt. So I do not have to be convinced on the importance of being debt free.

You can have a debt free business with 100 employees when the economy takes a dump and lay every one off and work solo again and survive the hard times.

If the business has debt you can not lay off the debt as you would lay of workers to survive.

I see myself working to hard to throw away money paying interest.

I guess how much debt one can handle can not just go by a safe percentage of one's income.

But by how much one makes and how secure one's job is and how easy one would be able to get rehired at the same or better money if laid off.

Right now I am lucky that I can save the money to pay cash.



  #19  
Old 07-06-2013, 07:04 AM
herler herler is offline
LawnSite Gold Member
 
Join Date: Apr 2012
Posts: 3,389
No debt is safe to carry, that is how much debt it is safe to have.
  #20  
Old 07-06-2013, 01:51 PM
seabee24 seabee24 is offline
LawnSite Senior Member
 
Join Date: Mar 2009
Posts: 619
Quote:
Originally Posted by larryinalabama View Post
Good debt is what your compedators have.

In reality there is no good debt in this business, debt increases your risk of failure, debt is expensive, and debt on a asset that is going down in value is extremely expensive.

Too me a lawn mower payment doesn't even sound right.
Depends on your situation. So if you had 10,000 and not a penny more to your name, and you needed a new Ztr to the tune of 9k. You would pay cash? I would take the zero percent interest option on 24 months, then take my 10k and invest it in bulk savings or efficiency savings or heck put it in a CD an earn a small amount of interest.

That's n example of good debt. You could buy a used mower, but you would have to way the pro and cons.
Posted via Mobile Device
Closed Thread

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

Forum Jump





Powered by vBulletin® Version 3.8.6
Copyright ©2000 - 2014, Jelsoft Enterprises Ltd.
Copyright ©1998 - 2012, LawnSite.comô - Moose River Media
All times are GMT -4. The time now is 03:47 PM.

Page generated in 0.07889 seconds with 10 queries