finding financial peace
Popular finance expert Dave Ramsey shares his tips for weathering the economic storm in an exclusive interview.
by Kelsey E. Smith
Bleak headlines have been splashed across the media in the past several months as the economy dipped to its lowest levels since the Great Depression. But with a smart business plan, florists can emerge from the nation’s current situation not only victoriously but stronger than before. Dave Ramsey, a renowned financial adviser, best-selling author, TV show host and nationally syndicated radio show host who has helped more than 650,000 families through his Financial Peace University program, offers the following advice to retail florists for weathering the economic storm. Over the past 16 years, he has grown his successful small business from a card table in his living room to more than 225 team members. Each week, more than 3.5 million listeners tune in to The Dave Ramsey Show on more than 350 radio stations throughout the United States to hear Mr. Ramsey’s financial advice, and business leaders seek his advice through his EntreLeadership business conferences.
How to Dump Debt
Although Dave Ramsey’s plan for getting out of debt is geared toward personal finance, there are several ways to adapt it to small businesses. For example, once you have established an emergency fund for your business, the next step is to pay off all debt using the debt snowball. This method is designed to keep momentum going in order to get out of debt completely.
To create a debt snowball, make a list of all of your business’s debts from the smallest payoff or balance to the largest. Pay off the smallest debt first, then roll its monthly payment into the next smallest debt. For example, if your smallest debt is a loan with a monthly payment of $320 for one of your delivery vehicles, focus on this loan, paying minimum payments to all other sources of debt, until the loan is gone. Once the vehicle is paid off, put the $320 toward the next smallest debt. Continue this process until your business is debt free.
Visit www.daveramsey.com to learn about Mr. Ramsey’s seven “Baby Steps,” and consider how they can help you achieve financial peace in your business.
FR: What should florists and other small businesses be doing to weather the current economic storm? What shouldn’t they be doing?
DR: Have a budget for your business, and stick with it. Don’t spend more than you make. Have capital reserves—a business emergency fund. Now is not the time to be adding to your business debt.
FR: What should small-business owners be doing in the short term versus the long term?
DR: Nothing that I teach has changed in the slightest since this
thing started. I still encourage listeners to my radio show to
[eliminate debt] and to keep investing. Budgeting is the key
thing for getting through this, whether it’s for your personal
checkbook or for your business. Now, more than ever, you need to
be spending less than you’re making. Suddenly, my debt-free
mantra doesn’t sound so crazy.
FR: What type of advice should small-business owners take to heart?
DR: Start by having a dream. I’ve got a dream about getting the majority of America out of debt and completely changing the socioeconomic political landscape as a result. That’s a pretty big dream. Then you have to have visions and goals that point toward your dream. Remember, the tortoise wins, and the hare loses. You have to keep your eye on the finish line, and you have to take another step and never quit. And the only way you know where the finish line is, is you start to have goals. The hare runs around all over the place trying to find the latest, greatest thing, but he doesn’t win the race. Diligence means doing something over and over and over again.
FR: What do you think of the way the mainstream media is covering the economy?
DR: The media has taken an economic pothole and turned it into the Grand Canyon. They’re like chickens running around with their heads cut off. “The sky is falling! The sky is falling!” The economy could be better, but we are going to be fine.
FR: How can florists avoid panicking from all the negative news?
DR: Get debt free! People without payments don’t need to worry so much about the negative news. If your business is in debt, work hard to get it out. Panic won’t help anyone, but having a goal and reaching toward it gives you something to focus on. Remember your vision for your business, and work to find your place in the current market.
FR: Where do you recommend that small-business owners get daily/weekly/monthly information about the economy to educate themselves so they can make the best decisions for their businesses?
DR: It’s important to stay informed. Read! Business owners should have an idea what’s happening in the world. Keep track of the market, and know what the issues are for the demographic your business is trying to reach. You have to read a variety of stuff [including trade magazines and books] to get a good idea about what’s going on, and then you have to figure out how it applies to your business. You can’t run a business well if you’re clueless about what’s happening outside your four walls.
“Panic won’t help anyone, but having
a goal and reaching toward it gives you something to focus on.
Remember your vision for your business, and work to find your
place in the current market.” — Dave Ramsey
FR: Is this economic downturn different than others in recent decades, and if so, how?
DR: Previous generations thought debt was a bad thing. What makes this downturn different is people’s dependence on debt and credit cards. Changes in the economy are a lot scarier when you’re in debt. But the economy will rebound like it always has. We survived the Great Depression, we survived the S&L crisis and we’ve been through recessions before. It may be bad for a while, but we’ll be fine.
FR: For our readers who might not know much about you, what quote or piece of advice best sums up your philosophy for running a small business successfully?
DR: Slow and steady wins the race. People told me I couldn’t run my business debt free. They told me I couldn’t syndicate my radio show without being owned by a corporation. There were things we could have done faster if we had gone into debt, but that wouldn’t have been smarter. A lot of those negative people aren’t in business anymore, and my company is still growing steadily.
FR: What else do small-business owners need to know in 2009?
DR: [Getting out of debt] can be done! Think about the position your business could be in without any debt. Life is always more fun without payments, even in the business world. It’s time for business owners to start using common sense when it comes to financial matters.
Dave Ramsey is a money management expert, a popular national radio and TV personality and author of the New York Times best-sellers The Total Money Makeover, Financial Peace and More Than Enough. In October 2007, he added television host to his title when “The Dave Ramsey Show on Fox Business Network” debuted nationally. Mr. Ramsey knows first-hand what financial peace means in his own life, living a true rags-to-riches-to-rags-to-riches story. By age 26, he had established a $4-million real-estate portfolio, only to lose it by age 30. He has since rebuilt his financial life and now devotes himself full-time to helping ordinary people understand the forces behind their financial distress and how to set things right—financially, emotionally and spiritually. He resides with his wife Sharon and their three children in Nashville, Tenn. Visit
Contact Kelsey Smith at
firstname.lastname@example.org or (800) 367-4708.
Dave’s Top Picks
Dave Ramsey recommends small-business owners read the following books to gain a better understanding of the business world and how it relates to their success.
QBQ! The Question Behind the Question by John Miller
Thou Shall Prosper: Ten Commandments for Making Money by Rabbi Daniel Lapin
Developing the Leader Within You by John C. Maxwell
Business by the Book by Larry Burkett
Good to Great by Jim Collins
Guerrilla Marketing by Jay Conrad Levinson