Be strategic about borrowing

Choose cash or shorter terms for purchases to ensure you’re continuing on a successful path of long-term growth.

Save in advance as much as possible for larger purchases like equipment, software, and technology with the intent to pay for them in cash.

If you have a more immediate need, we recommend that you put a minimum of 20% down for any purchase and work to pay off the loan balance as quickly as possible.

Any asset purchase for your business should not be made with your own personal or retirement funds or personal credit cards. Keep your personal financial freedom journey achievements intact and separate from the business.

Selecting a longer-term loan with a lower monthly payment may seem like a more obvious choice. A shorter term, though, can save you thousands of dollars in costly interest and lessen the amount of time you’ll pay off the loan.

Remember that the less you borrow, the more revenue you’ll bring to your bottom line.

For example, let’s say you take out a loan for $250,000. By choosing a 3-year term instead of a 7-year term, you could save thousands.

$250,000 loan comparison with same rate
Term	7-Year	3-Year
Annual Percentage Rate	9.65%	9.65%
Payment	$4,105.23	$8,025.78
Interest	$94,838.93	$38,928.03
A shorter term could save you $55,910.90 in interest and 4 years of payments.
*Payment examples are for illustrative purposes only. Your actual payment may be greater and savings will vary.