Being an entrepreneur takes extreme determination and bold decisions. These same traits can be critical weapons in winning the battle against debt.
If you're an entrepreneur who's worried about debt — whether it's $5,000 or upward of $100,000 — now is the time to act to cut back.
These four tips from financial experts and entrepreneurs offer concrete ways to slash personal and business debt and emerge stronger.
1. Treat debt like a wound and act quickly
The best way to deal with debt is to confront it as soon as you begin to feel it weighing on your bottom line.
"You've got to stop the bleeding," said Jeff Rose, certified financial planner and CEO of Alliance Wealth Management. "Find the things that you're paying for that you may not need."
By making some temporary sacrifices, entrepreneurs can save a lot of money and reduce the amount of debt they accumulate.
Consider giving up on expenses like Netflix, video game memberships or other monthly subscriptions. Make your meals at home instead of eating out. You may even consider downgrading to a smaller apartment or house, Rose said.
"You have to start living lean and mean," he said.
For your business, there are many relatively easy cost-cutting measures. Start bargaining with vendors, get rid of unnecessary subscriptions, reduce power consumption in the office by switching to energy-saving bulbs or cut down on employee perks like free lunches.
One popular financial blogger, who goes by the name "J. Money," saved hundreds of dollars by just picking up the phone. (J. Money does not want his true identity revealed, citing the fact that he posts all of his personal financial information, including his net worth, online.)
"I went through all my bills that are monthly recurring and either bargained my price down or switched to cheaper services, like for my phone carrier. That alone saved me more than $100 every month moving forward," the author of the blog BudgetsAreSexy.com said. "I like recurring savings."
2. Bring in more cash
Once you cut down spending, concentrate on adding income from outside sources.
"It's a tougher pill to swallow, but until your business clicks, entrepreneurs may have to do that," Rose said.
Consider becoming a translator, tutor or dog walker in your spare time. They are some of the best-paying part-time ways to bring in extra cash, and the money earned can go directly to paying off your debt.
"The most important factor is how much you care about getting out of debt," J. Money said.
3. Consider refinancing
How much interest are you paying on your debt? There's a good chance it's too high. Take a look at the interest rates you're paying and consider consolidating debt obligations.
"Sit down and look and figure out, how high are the interest rates on my loans? Are you in the 5 to 8 percent range? Or in the 18 to 25 range?" Rose said. "If it's in a higher interest rate range, we need to look at refinancing your debt."
Looking at reliable lending clubs or meeting with a bank advisor are two good options, experts said.
4. Know when enough is enough
As hopeful and determined as entrepreneurs are, financial experts said it's important to know when the situation is just too much to handle.
"Draw a line in the sand on when you're not going to continue being in debt. Have a stopping point," said April Cleek, founder and CEO of health-care IT company EHR Concepts.
When first starting her business, Cleek used credit cards to pay her bills and keep the lights on. She racked up $30,000 in credit card debt. "But I didn't keep spending hoping we would be successful. I knew we were winning business slowly."
Increasing sales and clients provided concrete markers that her debt was "worth it" and gave her confidence that she could soon pay off her debt.
"If your business isn't growing ask yourself 'Why?' If you can define the why, you can know when to close the door or push to the next threshold," Cleek said.