Too pay off or not?

Discussion in 'Business Operations' started by KrayzKajun, Sep 29, 2008.

  1. KrayzKajun

    KrayzKajun LawnSite Fanatic
    Posts: 10,742

    As everyone knows i plan on getting a another/bigger truck for next season.

    I was planning on putting a good bit down/and trading in my current 1500 silverado. Here is my question-

    all my equipment is paid off except my 07 Exmark Lazer Z. I still owe around $4500 on this mower. Should i go ahead and pay off this mower? That way when i buy my new truck I have one less bill>
    opinions welcome

    Keep the blades Spinning
     
  2. DeepGreenLawn

    DeepGreenLawn LawnSite Silver Member
    Posts: 2,372

    I am personally trying to pay off all my debt and save cash for any future purchases... with the economy the way it is I believe this is the only smart approach.

    In general I believe this is how I will do things from now on no matter how the economy goes. I have run my house hold like this. Watching all my neighbors forclose and all I look at my own home. By the end of the year the only debt we will have is the house and car. I am willing to sell the car to get only the house... I go inside and all my furniture was paid for with cash. No matter what happens... they aren't getting it... if I have to, I sell it and put the cash in my pocket. Knowing this makes me feel good... if things go in the $hi%er and I do lose the house for whatever reason all I will lose is the house... nothing else...

    If business goes down to nothing... I still have all my equipment paid for... a job with the FD and time... I will store the truck/equipment for when times get better and live off the FD and anyother work I can pick up. When times get better I pull out the truck and sprayer and go back to work. No loosing everything or having to start all over... just pick up the needed fert and start applying...

    This is how I run my business from now on... I am about $2K away from having all business debt paid off and then it is worry free...

    Feels good...

    My suggestion... pay off the mower, if you have to get a beater truck to pull it with and stay out of debt. Save up and pay cash for a new truck...

    It is amazing how fast cash accumulates when you don't have it all going straight from the employer to all the people you owe... you will have a new truck in no time... and no payment...
     
  3. Edgewater

    Edgewater LawnSite Senior Member
    Posts: 457

    What has a lower rate? Put your money into the one that will cost you more to finance.

    You have to use financing to grow, but you have to your is intelligently. You will never have the cash to buy trucks outright if you need one every 2-3 years.
     
  4. KrayzKajun

    KrayzKajun LawnSite Fanatic
    Posts: 10,742

    the interest rate on my mower is double wht the rate would be on the truck!
     
  5. brandtb1

    brandtb1 LawnSite Member
    Posts: 153

    Pay the mower off. If the truck is in good shape, I would keep driving it. If it breaks down too much, it might be time for a new one. I like having every thing paid for except my house. The cars and truck are not new, but they get me around town fine. I keep them clean and they look fine to customers. If you have the cash sitting around, you might get a steal on a good used truck when someone is in a pinch.
     
  6. DeepGreenLawn

    DeepGreenLawn LawnSite Silver Member
    Posts: 2,372

    I bought a used F250... 2000 I believe? It looks great, runs great, and all for $7k. Cash... no payments... no worries... I know there is the whole tax break thing... but I would rather not have to worry about payments... if everything goes to hell, it goes to the barn... no worries... or sell it for cash... that is how I look at it...
     
  7. TXNSLighting

    TXNSLighting LawnSite Fanatic
    from DFW, TX
    Posts: 6,462

    Pay that mower off. Its the best thing to get away from the crappy intrest rate you have.
     
  8. TXNSLighting

    TXNSLighting LawnSite Fanatic
    from DFW, TX
    Posts: 6,462

    You dont know what year your truck is?!
     
  9. DeepGreenLawn

    DeepGreenLawn LawnSite Silver Member
    Posts: 2,372

    Does it really matter whether it is a 2000, 2001? I am 99.999999% sure it is a 2000. The thing is it is paid for... minor repairs here and there to make it like a new truck and we were good to go. Had a couple mechanics check it out real well and got the OK.

    I have a work truck for cheap. No payments, no debt. More incoming money to be used elsewhere. Everyone is talking about how companies are taking out this debt that they may not be able to get to to pay their employees... that is the kind of thinking that I believe has gotten us to this place...

    I can see borrowing money to buy equipment and stuff to start with... but I would think that you should be able to have enough money to support it at the beginning... otherwise work a little longer, save up the needed money and then start the business... is this such a hard way of thinking?
     
  10. TXNSLighting

    TXNSLighting LawnSite Fanatic
    from DFW, TX
    Posts: 6,462

    Cuz you should care about your truck...
     

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