Around the time I started my business was right around the time I started getting serious about getting rid of debt.

I was getting married and was spending a lot of money on the wedding. I’d been in debt before, and it’s no fun to try to crawl out of, so instead of adding more debt, I basically decided I’d ‘get another job’ by starting my own business. Because I was short on cash, it was a necessity to start a business conservatively, and without creating debt. I started my business on these principles because I had to – but have kept those principles in place, because they WORK. I know all businesses can’t be started without big purchases upfront, but creative businesses usually can. There will always be things to buy, but they don’t always have to be purchased upfront. They can be paid for with earned revenue, if you have the option to start small, and slow. I’ve mentioned before, that there is a very low barrier of entry now on starting a business. In fact, there are countless books written about starting lean businesses. I’d love to share a few things with you that helped me start and maintain a lean business. Disclaimer – I’m NOT a professional financial adviser, this is just what worked for me.

1. Bill wisely

Don’t do ANY work until it’s paid for.

To us, this means splitting up payments, and having each one due before the work is performed. When I started my business, I just wasn’t big enough to have ‘credit’ to cover my clients, and bill them later. I used their cash to order the materials, plain and simple. I watched my bosses bill clients, net 30 or 60, and then after non-payment, have to add on finance/late charges… and inevitably they had to hunt them down for payment. They never wanted to pursue it legally, so they just ended up losing the money. I knew that wasn’t even probable for me, so I made it my policy from day one to get paid before the work was done, and it’s served me well I think.

What if a prospective client is not okay with it? They are probably the ones who would find some excuse to not pay you in the end – so stand your ground. You deserve to get paid for your work no matter what. You are a professional, they are leaning on your expertise as a business and your contract should clearly state your terms.

I was talking to a home contractor the other day, who said he also takes payments before ordering materials and work is completed, stating he ran a “debt-free business” and I thought that idea was brilliant. It makes so much sense when you put it that way. Feel free to use that line to anyone who questions your policy. Repeat after me: “I run a debt-free business.”

2. Purchase wisely

I’m an Amazon Prime shop-a-holic in my personal life (anyone else?), but I don’t purchase things for my business on a whim. It has to withstand a few criteria in order to get me to buy. You can use some criteria of your own, to help you decide, but here’s what I ask myself:

First of course – is can I pay for it in cash/debit, or are there payment plans in place to make it so that I can pay in cash? Do I really NEED it? Do I need it NOW? Will it return the investment I put into it within a few months? If it’s a workshop – will it directly make way for me to make more money? Or, is it stress relieving to help with productivity, or will make connections that will open new doors?

I see a lot of people falling in to the trap of things being “tax deductible”. Tax deductible does not mean free. You are still paying for a majority of the object, only a tiny fraction of it is saved on taxes. With that said, if you need something anyway, a tax deduction can be a nice perk. Just remember you’re still paying for about 80% of it. You’d save 80% on that purchase by not making it.

3. Structure wisely

One money killer in business is having a structure or setup that requires too much overhead. Is it okay for you to just stay small? Is it necessary to have a brick and mortar studio? Could you share the office space with others?

Making sure you are the right official business structure can save you money. I recently incorporated and became an S-corp, which will save me money, and also gives me valuable protections that could save me a LOT of money. Consult with a lawyer or CPA to see which structure is right for your situation.

4. Hire wisely

Do you have employees or independent contractors? I have both, and I’m saving money and headaches by having them be the proper classification.

Do you have help at all? A lot of times it actually SAVES money to hire someone at a lower rate than you’d be charging to do the same task. Let me say that again, a lot of times it actually SAVES money to hire someone at a lower rate than you’d be charging to do the same task. Don’t assume it’s cheaper to do something yourself. You should be doing the highest paid items in your business, and giving the least paid (or totally unpaid tasks) to someone else.

Conversely, are you paying TOO many people? I’ve seen some business owners hire out too many people as well. Make sure everyone on your team is doing their job well and efficiently. Perhaps one of your amazing employees can do the job of another less-than-stellar one. You’re doing both them and your business a disservice. They should all be invested in the business success. When your business profits, your employees do too!

5. Choose clients wisely

The single most hefty killer of money and time could be a draining client… Someone who sucks up all your time, or positive energy and gives you nothing in return to fill your cup back up. Someone who does not appreciate you, your services or your talent will be a drain on you fiscally, emotionally and spiritually. It is also doing a disservice to the client if you aren’t in love with them or their project. If you are not a good fit, they won’t be getting the BEST of you. It’s a waste of precious time and energy on both sides.

  • To me, this is the hardest part of business. I naturally want to help everyone, always. I will always be a work in progress in this area because of that. I do try to remind myself that THEY deserve better. There is always a better fit for those type of clients, and to truly help them, sometimes I have to let go.


As always in business, it takes a lot of heart, AND a lot of brain to keep your heart in check. Are you running a lean, debt-free business? Could you do even better?


Tired of trading time for money? Need to develop a system of passive profit that doesn’t depend on you? Have no clue what to offer or how to start? This is exactly why I developed the e-course, Create Passive Profits. This course will help you to develop the idea and hit the ground running with it. Early-bird registration for Create Passive Profits opens VERY soon. Make sure you’re signed up to the DLP newsletter to be first to know when registration opens!