Question:

‍What is the difference between Short Term and Long Term debt? Why do I see my loans on the balance sheet twice?

More insidious than Dave Ramsey’s obsession with debt, is his admonishing small business owners to not have partners. Let me say upfront that I completely understand what he is trying to accomplish with people, and I’ve certainly experienced my share of bad partnerships, but abstaining from all business partnerships is frankly a little goofy.

I am going out on a limb here, but I don’t like Dave Ramsey. That may be heresy to some, but let me explain why. Aside from the fact that he is dull to listen to, has not a funny bone in his body, and generally is preachy and dogmatic, that is not why I think Ramsey is bad for business. It’s not even that I disagree with his advice, although most of it tends to be more family therapy than financial help. In large part, his recommendations make a lot of sense for the right people, and that is what brings me to my trouble with him. His advice is geared towards wage earners, NOT small business owners. I’m sure there is a lot of crossover, meaning many small business owners have wage-earning spouses, and deal with many of the same issues. The shortcoming is, however, that Ramsey’s advice doesn’t go far enough. His advice is, “if you don’t have cash, don’t buy it.” Brilliant idea, but not very practical for most small business owners. Sure it is preferable to not have to borrow money, but does it really make good business sense?