pay debts or use the money to invest?

[minivanman]

You are correct, IF he had the money when he came here. I thought his government screwed him out of everything, I misunderstood. But still..... he borrowed a small amount of money (at the least) and failed, so now it's going to take him 2-3+ times LONGER to get back in the fastlane. I understand he came here not quite knowing how everything here works but most people that have lived here their whole lives don't understand those same things. So now that he is where he is........ he does NOT have an exact plan except maybe this and maybe that...... so without a plan, pay off the debt, work those long weeks and by the time he has saved again, he can put together a plan. Already thinking like a fastlaner got him in to trouble last time because he didn't map out his journey, he picked up his friend that he barely knew (franchise), filled the car up with gas, turned up the radio and off he went depending on his friend to guide him. Turns out, they ran out of gas and no money to get any more gas so his 'friend' abandoned him and that's how he wound up here.

Or at the very least, you can get other friends and you can tell your creditors to go to hell but pay off the IRS. They are the last people you want to screw with.

 

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[minivanman]

Not really important at all WHY you borrowed money. Why you did it is a thing of the past. You gave your savings to a company and lost it all. That's why I NEVER spend all of my money in 1 place. Spread it around. I could buy several franchises nowadays but I'd never give 1 company all my money no matter how much or how little I have. I'm out.... you do what you want, but think of me later. Good luck

 

[JAVCCS]

Because he already thinks like a fastlaner.

It sounds like the failure of the franchise was not that it started with debt, it was due to a misjudging of the partner's character (trusting someone who was untrustworthy). That doesn't mean that OP is bad with money. Almost everyone on this forum has a "never again" story of how they were burned in a partnership. Almost anyone can be scammed by a clever con.

Yes, the situation was the following, when I made the decision to come I knew that I had to have a business that gave me cash flow, but at the same time I was against the clock because my life was in danger every day that I stay in Venezuela, so when I was offered the franchise business I had two options:

1) I took the risk alone without having experience in that business, in a new country.
Or
2) Give 20% to a family friend who had a franchise like that and 5 years of experience in the industry.

What can go wrong, right? well the rest is history...

 

[JAVCCS]

Not really important at all WHY you borrowed money. Why you did it is a thing of the past. You gave your savings to a company and lost it all. That's why I NEVER spend all of my money in 1 place. Spread it around. I could buy several franchises nowadays but I'd never give 1 company all my money no matter how much or how little I have. I'm out.... you do what you want, but think of me later. Good luck

Yes man, for sure! And I'm not only going to think about you, I'll also let you know about progress ... this is fuel for me

 

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[JAVCCS]

Guys I want to thank you all for your contribution, I think it is very clear what to do. If option 1 does not apply pay the full balance in debts.

Thanks to each and every one of you.

 

[TreyAllDay]

It depends on the person, however I paid off all the debts as soon as I could. The biggest killer of entrepreneurship is making the wrong decisions because of debt and being pressured into poor decisions.

Even now my business does $15k/month. I refuse to get a new car or buy a large house, no way in hell am I going to buy anything I can't pay in cash.

 

[MisterBHZ]

work 80+ hours a week and before you know it, you will have way more than $20,000 saved. Should be simple..... I can say that because I used to work 120 hours a week.

How did you feel after working that many hours? How long did you go before cutting back?

 

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[SamuelMazzotta]

I agree with @AllenCrawley, no debt, no pain. Indeed you'll feel lighter and motivated for doing more for you and not for creditors.

 

[WJK]

I would definitely pay the friend and the IRS. Is the other loan a car loan? I agree with @Samix and keep a little in reserve, even if not a whole $5000, and use it for an emergency fund. I would use the freedom from the other debts to double down on the fixed payment debt, and make sure they know that you want the additional money applied to the principal and that there is no penalty for early payment.

We debate this issue of investment debt all the time at my Landlord's monthly meeting. But, I agree with the above. FIRST, get the IRS paid. Then your friend. Keep some back for emergencies and get that consumer debt off of your back. Then you can invest. RIght now, you have a foot on your neck.

 

[Guest61362]

I agree with @AllenCrawley, no debt, no pain. Indeed you'll feel lighter and motivated for doing more for you and not for creditors.

Get your FU money from null not below zero.

Subzero is such a soul-crushing place!

 

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[Matt Mortensen]

My opinion is that you should have a plan either way. Have a solid investment plan or use the money to pay off your debt.

 

[SamuelMazzotta]

Obviously, don't have debts is the best way to live light and sure;

but in real life, especially in entrepreneurship, debts are common or necessary, so here only your skills to struggle it and delete it, and your emotional feelings are the keys to tackle your personal situation and go out as a winner.