548 | The mental and emotional benefits of running a debt-free business Part 1

Chris LoCurto 0:00
On today's episode, we have an exciting topic to discuss that you as leaders or business owners cannot miss the mental and emotional benefits of running a debt free business that is coming up next.

Welcome to the Chris LoCurto show where we discuss leadership and life and discover that business is what you do, not who you are. Welcome to the show, folks. I hope you're having a fabulous day, wherever you are. today. Joining me on the show is the great the fabulous, the incredibly attractive Joel Fortner. Hey, welcome to the show, Joel.

Joel Fortner 0:50
Good. Good to be here. I'm not always described as attractive. But I'll take it.

Chris LoCurto 0:56
Incredibly, extremely whatever I say, there you go. So good to have you on. Hey, Joel is joining me today. Because this is a tough topic. This is a topic that is difficult for people to hear. I can tell you as somebody who has been leading business owners and leaders for decades, this is a very painful topic for me. Because of how much this discussion this this topic has hurt people has affected people. I'm not just talking about the business owners, I'm not just talking about the teams, but families as well. So as we get into this, I do want to say please just stick with this. If this is something that you're like, oh, I don't need to hear this. I'm, I know how to handle money. I don't know how to I am better than that I got the stuff figured out. If you do me a favor, just stick with us. Just just hear what we have to say. And hopefully, maybe there might be some things that you'll pick up to at least adjust a little bit of the security you have in debt. This is coming from a heart of a teacher who has counseled many people through this process. So I just wanted to throw that out there. If many of you are already like, I'm not, I don't want to listen to this. I'm not getting anything from it. I promise you, you will. So with that being said, I'm going to turn this on over to Joel, to get us kicked off.

Joel Fortner 2:24
Yeah, so I mean, this is a tough topic. You know, it's like, it's funny, it's like you said a debt free business. And I heard a debt free business for a moment. And it's like, you know, it's like, there's something actually to that funny enough that we know that depending on what you do with money and debt, it can be that destructive. So that's why we want to talk about it. And we've talked about it again on the show. But we wanted to do this show a little different where where I interview you and draw out, you know, a lot of a lot of your perspective, I'll share a little bit, probably as well. I used to be someone that had no problem with debt. You know, and that I was the person that I always I always thought it's like always have a car payment, like just talking about personal debt, you know. And it's been, it's so refreshing when I started to learn from you. And you know, back in Dave Ramsey days, and I met Mary Beth and she worked with you at Dave's and all this stuff about money and debt and really started being like, wow, this is there's really something to this. And I remember in my personal walk, that I was standing in Mary Beth's kitchen one day when we were dating, and I was a single guy living in small town, Tennessee, making really good money for a single person. And I had no money because I was spending everything. And it was just going here, there and everywhere. And I finally got mad enough about it. And that was the beginning of changing for me. Little that I know at the time that Mary Beth needed to see that change in the before she would ever entertain like a longer term relationship or for indefinitely marrying me because she'd paid off. I mean 10s of 1000s of dollars of debt. I mean, you watched her do that and probably counseled her a lot along the way that I've met I've met never be married to the person that I am today if I had not made those decisions because there's no way she was going to get wrapped up with spending Joel so let's get into this. First was

Chris LoCurto 4:24
you do it's so funny as you say that and I've known this story forever you know I was there during this story but for the first time it's so interesting the way you say it I'm as somebody who worked PR for for the military for the Air Force. You have all people know very well what keeps a person from having security clearance. And that's Debt Debt is the the number one reason why somebody either can't get or loses their security clearance. And it is amazing for the first time as you share that story the way you did. I don't think you've ever said it that way. In that order, and in that order, what I heard is Marybeth, you did not have security clearance. She, her security was, I couldn't be with somebody, I've already been through this crap I've already dealt with, I've already made bad decisions. I've been working my butt off to get out of those bad decisions. And now here's this guy I want to be with. But he's representing putting me back in a place that I hated. And so her security jumped out in that moment. So I just think that was interesting.

Joel Fortner 5:30
It's a really good observation. Yeah, all she saw was risk. With me, she saw risk. And she saw hope when I got pissed off enough about it, to finally to finally change it. So So today, we're really get we're talking about business and business debt. So first, right up right at the top here. Why is this such a big deal? Like? What are the risks? Chris? How do you share? Like, what are the risks surrounding business debt?

Chris LoCurto 5:56
Yeah, I know, we're gonna dive into this deeper, so I'm going to try and just make it quick. There's no way this is going to be fast. So this isn't just for business owners, as a business leader, you know, you're the president of our company. If I take on debt, it affects you. If I was to go massively in debt, or decently in debt, it's going to affect your decision making processes, it's going to affect your opportunities, it's going to affect what you can do with the team who you can hire who you can't hire, there's so many aspects of how it affects your decision making as a leader in the business, it affects all the leaders inside of the business, right? So as we talk through this, I don't want people thinking, while I'm not a business owner, this doesn't apply to me, oh, for the love. If you're a team member, it affects you, right, the way that a business owner or a leadership team approaches debt affects every aspect of the business. Now, I want to hit the heavy one up front, because people's security with debt always comes from they've convinced themselves that they're savvy enough to handle debt. And so let me just put this in there. If I get a little excited in here, and by excited I mean, you know,

Joel Fortner 7:13
go on, passionate, you little passionate,

Chris LoCurto 7:15
it's because I have sat with the folks that, you know, felt like they would be better off not being in the business or better off, not being with their family or getting a divorce or even you know, I can't tell you the number of people around this subject. It's unfortunately, a large number of people that considered not even existing, because of the bad mistakes that they made. It's not one, it's not to just me alone. It's a large number of people that I've experienced this. So I'm passionate about this, because of what it does, right? The the convincing yourself that you're savvy with finances is just such a dangerous place to be in. So what that what are some of the risks? Well, the number one risk for me, is the god factor. You have it, I don't care how great and right now the world's not going very well. But in the times when things were going so great. I remember, you know, 15 1617 years ago that many years, yeah, I met probably even not many years ago, being with clients at events, who were just adamant that they understood how to handle finances better than I did you know that better than Dave did? And just like, oh, well, I hear what you're saying. But here's what we're doing. And I would sit down with them. And I go okay, yeah, sure, yeah, you're $8 million in debt, and you have a $1 million net worth. And you're continuing to pile on what do you think's going to happen to that? Wow, we got this under control on like, what if one thing happens to the economy? Yeah, well, everything's going well, in our area, everything's fine. You know, they always have all these amazing excuses. And then I'll just sit down with a pencil and paper and go, can I show you how fast you could get out of that $8 million and have a greater net worth, but you'll own less? Well, that's not as exciting. That's not as attractive, right? I don't want to own less. I want to own more, the bigger number of things that I own or stuff that I own or the bigger My business is, is the exciting part. And to get there, I have to go deeply in debt and leverage myself that if something goes wrong, and what did we see happen? Oh, my gosh, we've seen it happen like crazy. We saw the the bubble burst. And praise God, those are conversations that I had, that I believe they made the chair they told me they were going to make the decision to adjust things. And so by the time the bubble would have bursted, hopefully they would have been right sized and doing well. So what am I saying? You don't understand what God's going to allow. You don't understand what God's plans are for for any specific area, we don't know, we don't know if the market is going to tank, we don't know if a COVID is going to hit. And, you know, we had some of our clients praise God, we had a great meeting with our clients. That's the first thing we did is we got on a zoom call and said, guys, we're not going to face this with fear, we're going to do smart things, we're going to make smart decisions. And overwhelmingly, the response back to us on that call was, hey, listen, we've been doing what you teach, we're good, we're golden. And that was probably 98% of our clients. But there was a one or 2%, where their industry shut down, they didn't have a choice, their industry shut down, because of what happened with COVID. They were in a good position. But all of a sudden, their industry didn't exist for either a short period of time or a long period of time. And that was just in the moment, it appeared to be devastating, praise God. God was able to pivot them. Think of Ross on friends pivot, pivot them into a better situation, a better position where they could continue. And I think that's just the blessings of God. So first big risk, obviously, is, you have no clue what's gonna happen. You are not a predictor of, you know, all things good and bad, you know, bad stuff happens all the time, it shifts things that adjust things. For me another huge risk is is that debt robs you of your options. So you may be taking on this debt, in an attempt to grow or do something that seems fun. And all of a sudden, something better comes along and you can't do anything about it. You can't take advantage of that situation. You can't hire that person that you know costs more money, but would rock your world, you can't go into that market and spend money because you don't have any money to spend in that market. Your only option is to go further in debt. So there's an incredible number of risks. Another thing is, is that and I think this is massive. It puts you in a different state of mind. When you are slave to the lender, oh, I'm savvy, I've got this under control, you're still slave to the lender. Do you know how many people don't understand that their mortgage says that the bank could take the house back at anytime, if they wanted to, they could call that loan at anytime. You could be responsible for 30 days of coming up with that money. Most most people don't even know that. You don't know what's gonna happen. But it puts a pressure on you to have to accomplish have to overcome that debt on a daily basis. Every single month, that's your nut that you gotta crack, right? If you don't crack that nut, you're in trouble. You now have this added stressor. And this for me, I think is the biggest personal risk, because here's what affects every aspect of your personal life when that debt is looming, and it's something that you've got to take care of, and, and you know that any small shift could affect you in a negative way. Guess how you approach your spouse? Guess how you approach your kids? Guess what your social life looks like? It doesn't exist anymore. Right? If it does, it's, it's, you're not a great contributor to it. And it's very short and sweet, you know, very short and sour, actually. So there's so many aspects of your personal life and the negativity in the cortisol that is dumping into your stomach because of the fear, the nervousness, you know, all of the things that you're experiencing, of what if what if this goes wrong? What if things don't go the right way? What if I don't get enough sales, I have seen people in debt, ripping team members heads off, for not doing things the way fast enough, good enough well enough. I remember watching a friend of mine, as a leader, just decimate a whole team. Because he had made bad decisions and markets tanked and affected. And it wasn't even a dead situation, believe it or not, it was just they weren't making enough money for what he wanted. And so that, for me is also just huge. There's a ton more risks that we could talk about. And I know I was going to try and make this short. But there you have it.

Joel Fortner 14:24
So what about opportunities, Chris? Like what, what opportunities does debt afford? Because a lot of people will push back and say, whoa, whoa, it actually gives me the ability to do things and more things than I could with maybe my normal cash flow. There's decisions I need to make and it's growth opportunity right now. And I'm gonna have to go into debt and I've done it before and everything's worked out pretty well. Like what do you say to that?

Chris LoCurto 14:50
Yeah. So here's the deal. On the surface. That sounds phenomenal. It sounds like you really can't argue against this, Chris. because really the opportunities right there in front of me, once again, the opportunity is your prediction of what is an opportunity, and how it's going to play out, as well as your desire to take hold of that opportunity in a way that puts you decently out of control. What do I mean by that? There's a world of difference if I decide to open up a second location, brick and mortar, and I do it with cash, and things don't go well. I saw my brick and mortar, I'm not in debt, I don't have to cover everything, I don't have to shift a whole lot. Now. I'm not gonna go crazy in depth on this. But if I'm doing a great job and my first location, and all the energy is staying there to operate that and do well, then I can start on something else. And if I have the right energy, there's so many caveats into opening a second location, I've just as I'd say this, I'm like, credit, please don't anybody here, rush out and open a second location. There's so many things you have to do, right? But let's, let's assume that I'm doing everything correctly, except I go into debt, ooh, it's an opportunity, I can open up another location. Because the debt is now a part of the first location. I've now affected everything that I'm currently doing in the moneymaker. And then it creates this desperation that I must make the second location work, it has to work, it has to work because I gotta pay this bill, I've got to pay all these people, I gotta take everything in. So my desperation leads to this place, this great new opportunity leads to place. And, man, there are probably 30 or 40 clients listening to this going, oh, yeah, I went, I went through that myself. Or I'm going to force every bit of the moneymaker, or a good portion of it to try and solve this great new opportunity. It looks amazing on the front side. But I've never been there before. And so when I get into this thing, all of a sudden, I'm realizing it's not going the way I wanted it to it's not going at the speed that I want it. It's not happening the way that I thought, I'm not getting all the money flowing in like crazy. All these things aren't happening. And so then I've got to force my moneymaker to try and come over and help this thing out, right. So now we've got this this person, people, company, whatever, that has this amazing opportunity. And they're yanking energy. They're yanking resources from the thing the current moneymaker, which is causing that to start to drop in possibly even tank. So what you're not hearing me say is no, you can't there's absolutely zero opportunity with going in depth. That's not what I'm saying. What I'm saying is, is that you're putting yourself at a much greater risk than if you were to save up and pay for the opportunity all but what if the opportunity goes away? What if it does? Are you are you telling me that was your one and only opportunity in life to make money to do something to grow your business? If it is, you might as well just get out of business right now? Because that's the only one opportunity that's coming along. You're incredibly short sighted, right? You do not have an abundance mindset. Instead, there are opportunities all the time. So I'll give a small example that I tend to share. Because this is one of my one of the ones that I just loved this guy's energy in his idea. So I've had, I've had many people come to me with restaurant ideas, oh, I've got to go $300,000 in debt, and it's always around that $300,000 mark, to do a brick and mortar because I make the world's greatest, you know, pasta, sound like, everybody loves my home cook, and I gotta go start a restaurant, they go heavily into debt, start a restaurant know nothing about marketing. Nobody knows that they exist. They closed the doors three days later, because it was just a big pain in the butt. So I had a guy reach out to me, he's like, Chris, I make the best tacos. I'm in Southern California. And everybody raves about how good my tacos are. Everybody loves them. So I gotta go in, you know, I want to go open the store and I want to go into debt. And I know you don't like that idea. But I just wanted to run this by you. And I obviously push back on Hey, you don't need to go open a brick and mortar. If your tacos are so great. Then go out and buy a rolling cart. Now out in California, they may not have this where you are. But in California, it's very popular to have a two wheel in New York City, very popular to have a two wheel rolling cart. You know, four wheels, two big wheels. You roll this cart around, you can make your tacos on the cart, and give those to people sell those to people. You could go down on the beach and sell them you could go to festivals and you could do all these things and make sure you know proof of concept. Do I have a plan to make money with these great tacos? And I said once it works and you're making great money by food truck This was well before food trucks were super popular, right? I'm like, buy a food truck, and then just drive around and sell them out of the back of your food truck or out on the side of your food truck. I said, if that works out incredibly well, then if you've got the money, do your brick and mortar and go from there. Right? His response was, I hear you. But what if I lose out and somebody else comes along? And you know, is selling their tacos? Well, and I'm like, that's your answer. What if somebody else comes along and sells tacos? Man, there's 14 billion taco places in Southern California.

Joel Fortner 20:36
Exactly. Do you realize where you live?

Chris LoCurto 20:41
You're not the only person who's selling tacos, man, there's going to be more that come after you. You but the concept is, is that I'm going to I need to take advantage of this market right now. It's a current opportunity. And the number of businesses I think it's 80%. I believe it's 80 85% of restaurants that go out of business. Because they don't know what the crap they're doing. And they don't have the money to do it and all that kind of stuff, right? So what's my point, it doesn't matter. You can have the greatest tacos on the planet, if nobody knows where you are. And nobody knows to come to you. And nobody's excited about the what people don't like tacos, which everybody likes tacos. But the point is, is that this great opportunity, going heavily in debt can become the worst opportunity you've ever experienced. If you prove that it works, and you do it in small, medium to large, then what you'll be amazed with is that you're able to grow this business without the stress of debt, without jacking up your family, because you don't know what your kids names are anymore. Because you spend 90 hours a week, you know, selling tacos, you have no marriage left with your wife, you know, all that stuff. So, for me when people say the opportunity, I am not saying that there isn't an opportunity. What I'm saying is, is my life is a bajillion times better, because I pay cash for those opportunities. You know, when those opportunities come in you you've been a part of this. I mean, how many times have we looked at an opportunity and said, Nope, it's just not that important. And all of this is still leaving out the god factor is God telling you to go after that opportunity? If God is telling you to go heavily in debt, to make a business, I promise you it's not God, because that goes against his word.

Joel Fortner 22:27
So on your previous point, I'm going to continue to play my devil's advocate, push back and be like, you've made some good points, Chris. But what I'm one of the things I'm doing, advocate for the devil, you know, it's absolutely not. It's my fake devil's advocate, you know. So it's the FDA. Oh, that was like, Oh, that was bad. That's bad. It's fun, too. So anyways, to continue to play this character, it's like, Okay, so you've made some good points. One of the things that you may not understand is that like, we do a pretty good job planning and doing risk assessment. And we've been doing this for a little while. And so I hear what you're saying, but like, we plan pretty well, like we have a pretty good idea on our market and what's going on. So I think you may be overstating the risk at times, is what I would say to that, like, what do you say to that person?

Chris LoCurto 23:29
COVID. market drop. luxury items no longer needed? There is an insane number of answers to that, that show us when things change. I mean, war. What happens when war happens? What happens when election changes, you know, the the person that seemed to be in your court, there's so many incredible things that change somebody's great idea of how well they plan. Did anybody plan that COVID would come along and shut the world down? I mean, let me let me rephrase that. Did any small business owners plan that I'm sure people other people planned it? But were any small business owners so savvy that they saw COVID coming and they took advantage of it? Yep. I

Joel Fortner 24:16
mean, isn't that just life though? I mean, isn't that what you just you get to that, and then you plan you replan and you and you work your way through those big challenges that you because you can't foresee everything, and I hear what you're saying. But can't you just reset your plan and continue to do that? I mean, to me, that's kind of just this again, everyone, this is me playing a character. You know, this isn't what I truly believe, in case you're somehow just dropping into the recording in this episode in a very weird place. 25 minutes and you hear Joe like, what he's gone off the rails here. But like, you know, but isn't that reasonable? Isn't that the part of the fun and the thrill of business is just is navigating that kind of stuff.

Chris LoCurto 24:55
So the person who's asking that question, did not experience hence the insane number of of businesses that closed during COVID. What was the issue? They just all didn't know how to plan. Is that what it is?

Joel Fortner 25:09
And maybe, yeah, maybe so. Or

Chris LoCurto 25:13
ticket if you compare our clients, to the folks who are not our clients. Our clients didn't close their doors. They were able to pivot they were able to replan, they were able to handle things, because they were set up for bad times like this. They were set up, you don't know what's going to happen on the land, right? Diversify, seven, you know, eight different ways because you don't know what's going to come upon the land. So our clients weren't closing their doors. Our clients are still with us. Our clients are still killing it. How is it that our clients have done such a phenomenal job of resetting, replanting, retooling? And yet there is an insane number of businesses that had no choice to close. Look at all the restaurants. Are you saying that as a restaurant, you're so prepared that you just replan are there some restaurants that took advantage? Totally. There were some that did a great job and jumped on the delivery bandwagon. There's some that got in, you know, working with local farms and things like that and made some adjustments. And then there's an insane number of them that closed that didn't have a choice. They couldn't stay open. And I will tell you, what's probably the biggest reason why so many of those closed is not because of lack of planning, it's because of too much debt, because it couldn't cover the amount that they owed. You know, they couldn't people weren't coming to them. Oh, not everybody can do delivery. Well, great. So if replanning in a COVID is all you got to do is switch to delivery? Well, how come all the other restaurants didn't make it? Right? Is it possible that this concept of switch to delivery? And then there's only certain restaurants that make it why? Is it because their food's better? Is it because their processes better? I don't know. Most likely, somehow they're getting in front of people in marketing really well, to get people to call them for food for delivery. The point being is, is that if it's only about this, this, and I'm sorry, I'm gonna say arrogant attitude of I'm fine. I plan? Well, I'll just retool, if things go bad. Then that hubris is probably the thing that's going to tank you. Right? It's having the thing that really helps, especially with our clients, is the ability not to stay stuck on how savvy they are. But their understanding of, hey, somebody's moved my cheese, I got to do something different. I gotta figure this out. You know, I gotta make something happen. So yeah, can you if you're a good planner, can you retool and make things happen? Absolutely. Did we lose way more businesses than anybody thought in this process? ABS is thinking lovely.

Joel Fortner 28:02
So Chris, what does a debt free business even look like?

Chris LoCurto 28:07
So again, opportunities are cash based, you don't you don't go ballistic. And most of the people that are owning businesses that are listening to us right now, most of them are probably in debt, to some extent, right? Even if it's on their credit cards, the concept is, is that you start your but now I'm gonna say, you start your business focused on what God tells you to do. It is not I don't, I'm not building an empire to self, I have no desire to do so. If I did, we wouldn't be doing the difficult stuff that we teach. We'd be out there cranking out widgets left and right, and making tons of money, right? Our choice to go the direction we go. This is tough, this is difficult. A lot of people don't want to follow it. I'm positive. There's a lot of people listening to this that don't want to follow what we're talking about. The key is, is for me, it has nothing to do with what I want in life. It has to do with what I believe God is telling me to do. So that's my first place that if you're going to run a business, if God's not telling you to do it, why do it? You know, this concept of ask God to bless the thing you're doing? Forget that, find out what he's doing and jump on board. It's already blessed. Right? So for me, when God called me to this business, it was tough. I mean, it took me three and a half years of hearing him say, you're going to be doing this, you're going to be doing this until the day I heard him go, you will do this. It was time I knew Oh, crud, I gotta go. I gotta start this business and start rocking. And it was a huge shift from a large platform to working, you know, speaking in front of 10,000 people to work in one on one. Right? And people thought I was nuts. They thought I was crazy. Like, and I'm like, because

Joel Fortner 29:50
just to jump in here real quick. It's like if you've not heard that episode, guys listening. There's an episode that we put out years and years ago called Why I left Dave Ramsey's organization, and that's what you're just barely grazing the surface on. But if you want to learn more about that story, go back and find that episode. It's one of the first episodes we ever released on the show.

Chris LoCurto 30:13
Yeah. And, and one of the main reasons is because so many people were wanting to find out dirt on Dave, and it's like you you are, so your focus is so crazy enough. So when I started this business, it was, you know, people like you're crazy for doing this. And I'm like, why not like because you're leaving the stage to go work one on one or with small, you know, work with a leadership team or small companies, small businesses, medium sized businesses, I'm like, celebrity was never my goal. Building an empire itself was never my goal. My goal is to help as many people as I possibly can. I'm a teacher, I love helping people. And so being able to do that, and step in with zero, you know, I started from scratch again. Now, praise God, I didn't even know that I had a large following at that point, which was great. But I started from zero not putting any money into the business. I'm going to start this from scratch. I'm going to you know, even though I had money, I had money to do it. But I decided I didn't want to put anything into this. I wanted to grow this thing on its own merits, all that kind of fun stuff. And it did. It grew very, very well. And it is stayed that very successful business that's focused on helping people to change their lives. We have never, nor will we ever focus this business on only cranking out widgets. Do we want to crank out some things? Sure. We'll get there. But it's what it's what it's important enough. Well, we have enough people in time we'll get there. But man we are. We love changing lives. And that's the important thing. So first thing for me is follow what God's telling you to do. If you're focused on you, man, you're taking big risks already. I'm a big believer that you're, you're either building one of two things, you're either building the kingdom of God, or you're building the empire of self. Right? Well, Chris, does that mean that I can't open up my taco shop not at all. If God's telling you to open up a taco shop, serve people wholeheartedly with your taco shop. You know, make sure that you have quality ingredients, that you're not putting toxic chemicals into people make sure that you're doing everything you can to serve people with a smile and, and help make their day better. And by the way, tacos are easy to make people's day better. So follow that. Second thing is do it in proportion to what you have money to do. These folks that are out there screaming from the top of the mountains, and they're still doing it to this day that you got to do your side, hustle, hustle, hustle, hustle, hustle, hustle, that's never going to be me, that's never going to be us, we're never going to be the people that say, you know, only see your kids, you know, an hour to a day and your wife an hour to a day and everything else is you bust in it, you know, 20 hours a day. Listen, you may have to spend some extra time getting your business up and running, you may have to spend extra time if the ox is in the ditch to get the rocks out of the ditch. There's no doubt about it. But having a business plan that's based on you operating 20 hours a day is stupid. 16 hours a day is stupid. You will have no life for what so you can make money. Because money is the important thing. So you can look like the dude who's standing on stage with a $500 T shirt. Seriously, is that your goal? If it is well then get after it. What you'll find is, is you'll have the same lives of all those people that made money there God, it will be destroyed. Instead, start with what you have. What can you do find small ways to get it going find ways to get your your your product out there your service out there, find ways to get people to be word of mouth for you serve people with just incredible integrity. And then what you'll find is is that not only is it going to grow on its own, but if you're honoring God in the process, then you can't be surprised that God may bless it as well. So you started small you do it the best that you can. As you have money, you make decisions, do I put this back into the business? Do I need to take some of this home? I definitely think you should be paying yourself you she needed if you don't have money. You know, for many years on it, I didn't take any money home because I didn't need it. I just constantly put it back into the business back into the business back into the business. Right because I wanted to grow the business so the money I didn't need I poured back into the company. So you know if you need to take some money home takes money home, but don't go into this thing going, Man I need to have $150,000 salary as I start my brand new business. If you need that much money, you probably shouldn't be starting a business, right? So pour back into the business what you can put plans together prioritize what it looks like to grow. What's the most important thing to grow? Where do you spend your money? You know, what are what are the aspects that are holding you back from growing, gaining more clients or being able to hold on to more clients? What To the aspects that are holding you back from servicing more, right? So all of those things are pieces that it's all in proportion to the money that you have. And on top of that, celebrate, celebrate the fact that you have a successful business, a successful team, that you guys are doing things and changing people's lives. And you're doing it in a way that you don't go home and are stressed out, because you got this debt load that's going to just devastate your family and your life.

Joel Fortner 35:30
So let's talk about credit cards for just a second. What is the difference between, quote, controlled use of a credit card, or loans versus using your own savings capital?

Chris LoCurto 35:43
Yeah, so there's something we can't ever get away from. And there's a great Dun and Bradstreet study that was done a long time ago, it still stays, it's still a strong study. That when you use debt, like say credit cards, even if you pay them off every single month, so Well, Chris, I got a company credit cards. Okay, gotcha. I know you're savvy with a credit card, I get it. Like we paid it, we never have to pay interest. Here's the deal. Now this is done on a personal basis. But I'm pretty I know people that have done the same thing in business. Dun and Bradstreet study showed that you will spend 12, to 18% more on the thing or things that you're buying, because you don't register the pain. So and by the way that even works sometimes with debit cards that you even though you know, you're not using the cash and you're not feeling the pain, as you immediately make that purchase, you could still spend more money. So what's the key? If you're not paying interest, that's great. That's fantastic. But it is highly possible that you're spending 12 to 18% more, or team members on your team are spending 12 to 18% more, because there's no pain, right? Well, then that means that you're losing 12 to 18% on stuff that probably isn't important. It's like the concept of Oh, you got extra profit at the end of the year, go spend all your profits, so you don't have to pay taxes. And then people go buy stuff, they don't need no go spend your profit on things that you need for next year that you would spend on next year. Because then it's a smart purchase, you're gonna buy it anyways. Right? But if you just go waste money to waste money, you could have taken that home. So what if you gave some to the government? You would have had something in your bank account? And now you just got stuff, right? So this concept of of managing it well, or, you know, handling the debt really well? Very, very, very, very, very, very, very few people actually do it well, but I get all these miles 74% of miles are never recovered, never used write off these credit cards? Well, we do. We have secured cards operates the same exact way as well don't use a debit card, because, you know, if you use a business debit card, you might in somebody hacks that you get a loss on that, then you don't get that money back, not 100% True. In our early days, with debit cards, we had stuff that was refunded where if somebody had stolen our number or not stolen numbers, but did their random system and bought stuff, we switched completely to secured cards. So our cards operate exactly as a credit card, we just load up the money. So instead, I've got multiple accounts, I shift money from this account into the secured cards, I've already got the cash, we're able to spend money off the cards. So in still I have to make sure that our team, you have to actually make sure our team is not just going out there and wasting money on stuff. We make smart decisions, do we have the money to buy that? Is that where we want to put our money? So if you're going to handle it in an intelligent savvy way, do it with numbers that make sense. Are we in a place to do this? Does this affect us in a positive way? Does this help us I'm not saying you can't go splurge on something because you're celebrating. Do it have fun? Just do it intentionally.

Joel Fortner 39:05
So that really one of the main things we also wanted to get into was all this mental and emotional component that you've already touched on a lot of this stuff as you've talked about things is stress and fear and hubris and pride and risk and what how that can affect people but share a little bit more on this love about this these mental and emotional benefits, especially for the business owner of not having debt. Like just how does it free them up emotionally?

Chris LoCurto 39:36
Yeah, so I think the greatest example for me is us during COVID when COVID hit, you know, we've got this full team of people that when COVID hit, we had to make some serious adjustments. And the first thing we did is we sat down with the team before we sat down with the clients. We had a discussion with our team came over zoom, you know, at that point, and said, We are not going to handle this with fear, we're not going into this with fear, we have plenty of money, we're in a good enough position. But we are going to plan around the concept of what if, what if things tank? What does it look like? What are we going to have to shift. And I remember, at that point, literally on that call saying some of you aren't going to be in the same role, at least not for a period of time. Some of you, you know, if we're not doing events in person, you know, we've got, you know, Katherine, who's handling all of the in person events we had, Brian that was helping with administrative stuff in the office and, and handling team stuff. And all I mean, we, we literally looked at some folks and said, Your role is going to change. So we may be moving to keep you hired, I'm gonna pay everybody, we're not shutting down, we're not kicking back, I'm gonna pay everybody. But your role may be moving into a different area, and you may be doing something you're not used to. You're not you may not even be qualified for, but I'm going to keep you on payroll. And so we went for, we may tell the shifts, the funny thing is, some people ended up being better in the other roles, you know, it was actually worked out in one or two situations where it's like, oh, well, we actually don't want to move here, we want to keep you here, you've something came out of you that we didn't even know existed. So that was great. We went for an incredibly long time, with losses of money. You know, we we lost a lot during that probably the first 610, seven, eight months. And we got, you know, halfway, probably six months through that. And our discussions as a leadership team is, hey, not changing anything. But we're going to have to start thinking about how long is this COVID going to last? You know, how long is it going to be? If this thing goes on for years, then obviously, we're not going to be able to sustain paying people in roles that, you know, we probably don't want 100% need. So we'll have to just start thinking through that. And praise God, we never got to that. I mean, within a month or two things turned around dramatically. Our clients were so glad to return. In fact, many of our clients were coming to our offices early on, saying, I'm not worried about this, I'm not afraid of this, we were able to continue to do events. Almost all of our Next-Level Lives. I think we moved off a couple of strap plans, we moved off a couple of Next-Level Lives. We just delayed them. But I think we did. I think we did almost every single one of those events. Still, I think we lost a couple of like next level apps or something that people that were, you know, immune compromised or something. And we got back to where we were, we got back to normal. There was not ever the stress of Oh, no, what happens if we lose this business that was never there. In fact, just discussions with my wife was, hey, listen, if God decides to tear this business to the ground, it's his business, he will start something else, we'll do whatever He leads us to next. And again, we were able to go through that whole nine month period, something like that. Nobody got fired, laid off, we kept everybody, we continued to work. While we kept that one person decided that they liked working from home, doing something else much better. So they left on their own that was that had nothing to do with us. But yeah, so I think for me, the I never carried crazy stress of what's going to happen to my business. I never got in there ripping people's heads off that they need to work harder and do more and figure things out. I I never carried any of that. I'm not saying that you couldn't have in my situation. I'm just saying that that's not something that I experienced. I experienced trust faith, and that we were in a position that we could continue doing what we're doing for a long period of time.

Joel Fortner 44:06
So you mentioned earlier about, you know, being slave to the lender. And, you know, I think about like the mental and emotional benefits of being debt free. Is do you think that that mental and emotional slavery is often how leaders look at it? Or do you think that they don't look at that enough?

Chris LoCurto 44:26
No, I don't think barely anybody. Unless you've heard that Scripture verse or you've heard teaching on finances that have to do with debt. I don't think anybody actually thinks of themselves as being slave to the lender. I think they think of themselves as being savvy. I think they think of themselves as being super smart. You know, I'm, I'm gaming the system, I'm able to, you know, make this debt work for me. I think that's exactly how people think I don't think they ever think of themselves a slave to the lender. Like I said earlier on. Most people don't know that the bank owns means their house, you don't own it. If you're in debt. You I don't care how many times you say I own my own house, now you don't, the bank does. And on that teeny tiny super small print, it says that any time, they could yank that house back if they wanted to. Alright, so I don't know the numbers, but I'm wondering how many, you know, super nice opportunities the bank took advantage of during COVID, while other ones they knew they couldn't do anything with it. You know, how many times did that happen? So when I look at this concept of being slave to the lender, that's God's words, not mine. What does it mean? Once I put myself in that position where I owe somebody so that I can take care of my stuff? I'm now their indentured servant. We're not talking about that Scripture is not pointing to the horrid slavery that happened in, you know, the South, you know, decades ago. We're not talking about the horrid slavery that happened with the Romans during biblical times. We're talking about the indentured servitude aspect. You now own me, as far as this money is concerned, right? I have to pay this off, I have to take care of this. There's no walking away from it. So for me, I don't think people ever think that, Oh, I'm gonna go in debt and be slave to the new car, lot used car lot. They don't think about it that way. And yet, they hate making that payment every single month. And when it's five, 710 years later, they're still paying on the same stinking car. That's when it starts to register, what have I done. But for a lot of people, they just go, oh, I'll just keep using this money. I'll just roll this over into a new debt. I'm golden.

Joel Fortner 46:45
So what if I'm weighing out options? Let's say my mental and emotional self is struggling massively because of where I work. And I'm like, Chris, I've got this great opportunity, and I'm gifted there. But I'm gonna have to go into debt to do it. And I'm struggling, I can't do it anymore. I can't go to work here anymore. Can I go for this? And should I do that? Because I already don't. I mean, life feels miserable. I feel like I'm not living out my calling. But man, I'm going to have to go into debt to get this thing going, like what do I do?

Chris LoCurto 47:19
Yeah. So you asked two different questions. Could I should I? Could I? Sure. Of course you can. Should I? Heck no. I don't think you should go from one horrible situation into another horrible situation.

Joel Fortner 47:33
Yeah. But this one's feels so much better. As the way that I look at it, it looks and feels and it looks because I've done some research. And I've looked into it, and I've talked to people like this seems just everything about it seems right. So it's like, really, should I not do that?

Chris LoCurto 47:50
Yeah, I think we probably should focus all of our decision making on our feelings, because those always work out. I feel it's gonna work out. I feel it's going to be good. That's not logical thing. Feelings aren't logic. emotions aren't logic, right? Logic is logic. So if I look at I'm making a decision to get out of a horrible situation, and jump into a nother potentially horrible situation by going into debt. How does that make my life better? If I feel horrible in this current environment that I work in, and then I go into debt, and the business doesn't work out. And my family is now in debt, and my wife and I are screaming at each other? And you know, the kids don't know who I am? Because I'm never home anymore. Was that better than the previous situation? So I think you have to separate in this is the very thing you just did. And you're so good at this because you hear it a lot. Is you just justified two completely separate things. Well, this thing is this way. So I'm justified if I do this thing over here, instead of tackling the first thing, what do I do about the first problem that I got? Go somewhere else, work somewhere else do something different? Oh, I

Joel Fortner 49:04
just can't. I just can't I can't do that anymore. Chris. I'm 45. And I've got it. I've been delaying doing my own thing for so long. I just, I don't want to work for somebody else anymore.

Chris LoCurto 49:16
If that's a person's attitude, then I say have at it. When it fails miserably, come back and realize that you chose feelings over facts. You chose a motion over intellect? If the answer is I have to do this because I don't want to do this anymore. Just know that you're already sold. You're down the road. You're making your decision. You're going to continue on. Ask any of our clients who have done that in the past and have regretted it like crazy and see what their response is. And you know, I've done it. I've made terrible decisions in the past that I've regretted. My thing is, is that I'm just a very You know, I, my focus is calculated risk, I very much calculate risk, not emotion. I'm not calculating emotion I'm calculating, what could the How could this fail? And what would it look like if it did. So for me, I've failed an incredible amount of times. That's why we have this business, God's just revealed to us how to fix them, and what to do differently and how to be smarter. So this isn't coming from a guy who hasn't made mistakes, I've made tons of mistakes. I'm this is wisdom from mistakes, this is knowledge from mistakes, don't go out there and convince yourself, you're going to be the first person who's savvy and really handle this. Well. I saw something the other day that said, all of the socialist college students, we should make it mandatory that they go that we send them off to their country of choice, the socialist country of choice, and let them survive there and see what they think, do they still agree that socialism is fantastic, it's amazing. You know, as a college student, you're you're smarter than everybody else on the planet, right? You just know so much more than everybody else. So if this socialist thing really truly works, although it's never worked, not even once on the planet, and the main argument against that is, while it's because nobody's done it correctly. Great. Go live in one of these socialist countries and change them, do it the right way. See what happens. The concept of I feel this is right, I can't do this anymore. I don't want to do this anymore. None of that matters. If you're not going to make smart decisions, I have worked in businesses that I hated, hated. And I didn't leave until I could cover my butt until I could take care of myself and put food on my table. You know, and I've had I've had some businesses that I ran in my early days, logistics was one of the ones I am so good at logistics, and I hate working, you know, in some of those environments is just toxic. But instead of leaving, I waited on God, I prayed and prayed and prayed and prayed and prayed. And God opened the door, I stepped out and it was smooth, the transition was smooth, it was great. It worked really well. So there's a lot of pushback on this concept of I don't want to, or I've got this great opportunity. That would be less stressful. Folks, if you've never opened and operated a business, which I've opened and operated many businesses, many, then you don't know what you're talking about. If you don't have the experience, you know, I love what Zig used to say. And entrepreneurs, the only person so business owner is the only person who can go from sheer exhilaration to sheer terror and back in the same 24 hours. That's what business ownership is like. So this concept of I'm gonna leave my negative toxic environment that I work in, and I'm gonna go work in a phenomenal, incredible opportunity. That is my new business with debt. I'm sorry that it doesn't happen that way. And if it does, if there's the unicorn out there, great, fantastic. But that's one in how many millions of businesses, right? And keep in mind the number of businesses that closed because people don't know what the crap they're doing. So I'm sorry, am I being too passionate about this? Is there Can you can you feel Can you feel the pain of all of the folks that I've helped that we have helped? Our business has helped over the years that have that have experienced the negative side? You know, so speaking to the person who's just convinced that they've got this man, don't take my words, go speak to people. But there's so much more that we could speak about on this.

Joel Fortner 53:34
Yeah. So, Chris, thank you. So we are we're out of time for today. We're gonna guys, we're gonna do a second part on this discussion. So make sure make sure that you listen in on part two, the mental and emotional benefits of running a debt free business. So

Chris LoCurto 53:52
yeah, well, folks, again, I hope this information is helpful. We are not done. We've got lot more to talk about. One of the things we want to talk about, especially because of what time of year it is, we want to talk about the Next-Level Leadership Live Event, as you've heard me say many leaders are frustrated, because they don't have time and tools to lead well. Your days get filled up with fires with people drama with meetings that are simply a waste of time, and you never seem to get to what's important, and what actually moves the business forward. Reading books and listening to podcasts aren't helping and not much about your work life is changing for the better. And that's the thing is, most leaders don't know how to implement what they've learned by reading books or listening to podcasts assuming that the information was even good. And obviously, you know, this show is good stuff. But that's why we created the Next-Level Leadership Live Event. So if you feel frustrated or stuck about work these days, go to ChrisLoCurto.com/events. That's ChrisLoCurto.com/events. registration opens December 1 with $500 off every ticket You buy. But that's for a short period of time, you'll learn lessons we practice daily in our business, that are only taught at the event, or inside of one of our coaching programs. And you'll have hours of workshop time, as well as access to all of our coaches. So go to ChrisLoCurto.com/events and take advantage of this limited time offer before it slips away. Well, folks, I hope this encourages you to explore the idea of running a debt free business. Remember, it's not just about the financial benefits, but also the mental and emotional well being that comes with it. And yes, if you're already well in debt, how about we talk about some of that on the next episode? We'll help you to get there. What does it look like to get out of this? We want to hear from you. We'd love to hear your stories, your insights, so feel free to share them with us at podcast at ChrisLoCurto.com. Well, that's all the time we have for today. Thank you Joel, for joining me.

Joel Fortner 55:53
Absolutely. Thank you always good to be on.

Chris LoCurto 55:56
We will see you on the next episode. Folks. As always take this information, change your leadership, change your business, change your life, and you join us on the next episode.