Debt Settlement Misconceptions That Can Easily Confuse Small Business Owners

According to the Bureau of Labor Statistics (https://www.bls.gov/bdm/entrepreneurship/bdm_chart3.htm), an astonishing 50% of all new businesses fail by the time they enter their fifth year. Due to inexperience, small business owners often make business projections that are overly optimistic and fail to control their expenses. The shortfall in working capital is usually met with credit cards and personal loans without paying a thought regarding how the repayments will be made. At one point in time, it becomes clear that making the monthly payments on time is impossible and the business owner is well and truly caught in a debt trap. If tactics like scaling down business operations, drastic cost-cutting, debt consolidation do not work out, it may be time for business owners to consider debt settlement. However, debt settlement is not a process that is easily understood, and due to the many myths and misconceptions, there is usually a cloud of confusion that prevents business owners from making smart decisions to resolve their debt crisis. Some of the top myths and misconceptions dispelled:

Debt Settlement Is the Only Solution

Even though debt settlement has been advertised hard and long as the ultimate solution for revolving a debt crisis, it is not necessarily the only one. There are some methods for tackling outstanding debt that business owners are not able to repay as scheduled. The first thing an entrepreneur should attempt is to strengthen the cash flow by scaling up operations without spending much more. They can also try cost-cutting and consolidation of existing debt so that they can make the monitoring and repayment easier and less expensive. Credit counselling is also a viable proposition for getting your business finances back on track through proper money management methods. However, debt settlement is the one route by which, you can attempt to drastically slash down the amount of outstanding debt and achieve financial freedom.