Good Debt, Bad Debt: Distinguishing Healthy Leverage from Financial Risk [THA 460]

Thanks to our Partners, NAPA TRACS, Today’s Class, KUKUI, and Pit Crew Loyalty

Watch Full Video Episode

It’s time to dig into real-world strategies for managing debt and strengthening the financial foundation of your auto repair business.

• Shiju Thomas, Hotchkiss Auto Repair
• Dustin Brown, Brown Auto Experts
• Hunt Demarest, CPA, Paar Melis and Associates

The first big takeaway: Cash is king.
Our panel emphasizes the power of maintaining healthy cash reserves—ideally three to six months of operating expenses—to safeguard your shop against unexpected disruptions. If the pandemic taught us anything, it’s that cash on hand can be the difference between surviving and scrambling.

Another core theme is recognizing the difference between good debt and “bad debt.”

Good debt includes real estate and other collateral-backed loans that appreciate, add stability, and support long-term growth. Bad debt includes high-interest burdens like merchant cash advances or short-term credit card loans—products that drain cash flow fast and offer zero assets in return.

The panel also addresses a common pain point: “Why doesn’t my bank balance match my profit?”
The answer lies in understanding the cash flow statement—specifically, that principal payments don’t appear on the P&L, even though they hit your bank account hard. Their guidance: pay off high-interest debt first, but don’t erase debt so aggressively that you end up “debt-free but cash-poor.” Cash matters just as much as debt reduction.

Bottom line: Be intentional with your money. Understand your numbers. And approach debt reduction as a strategy, not a sprint.

Additional Resources:

– How to Grow Your Shop Without Losing Control [RR 1046]: https://remarkableresults.biz/remarkable-results-radio-podcast/e1046/

– Business by the Numbers with Hunt Demarest: Understand the Numbers of Your Business with CPA Hunt Demarest. https://huntdemarest.captivate.fm/

Thanks to our Partner, NAPA TRACS

NAPA TRACS will move your shop into the SMS fast lane with onsite training and six days a week of support and local representation. Find NAPA TRACS on the Web at http://napatracs.com/

Thanks to our Partner, Today’s Class

Optimize training with Today’s Class: In just 5 minutes daily, boost knowledge retention and improve team performance. Find Today’s Class on the web at https://www.todaysclass.com/

Thanks to our Partner, KUKUI

Stop juggling multiple marketing tools. KUKUI’s integrated platform delivers 4x better website conversions, automated follow-up, and real-time ROI tracking. Get industry-leading customer support with KUKUI at https://www.kukui.com/

Thanks to our Partner, Pit Crew Loyalty

You’re probably tired of chasing new customers who never return. We understand. Pit Crew Loyalty ends the one-and-done cycle, turning first visits into lasting, reliable revenue at https://www.pitcrewloyalty.com/

Connect with the Podcast:

– Follow on Facebook: https://www.facebook.com/RemarkableResultsRadioPodcast/

– Join Our Virtual Toastmasters Club: https://remarkableresults.biz/toastmasters

– Join Our Private Facebook Community: https://www.facebook.com/groups/1734687266778976

– Subscribe on YouTube: https://www.youtube.com/carmcapriotto

– Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/

– Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/

– Follow on Twitter: https://twitter.com/RResultsBiz

– Visit the Website: https://remarkableresults.biz/

– Join our Insider List: https://remarkableresults.biz/insider

– All books mentioned on our podcasts: https://remarkableresults.biz/books

– Our Classroom page for personal or team learning: https://remarkableresults.biz/classroom

– Buy Me a Coffee: https://www.buymeacoffee.com/carm

– Special episode collections: https://remarkableresults.biz/collections

– The Automotive Repair Podcast Network: https://automotiverepairpodcastnetwork.com/

– Remarkable Results Radio Podcast with Carm Capriotto: Advancing the Aftermarket by Facilitating Wisdom Through Story Telling and Open Discussion. https://remarkableresults.biz/

– Diagnosing the Aftermarket A to Z with Matt Fanslow: From Diagnostics to Metallica and Mental Health, Matt Fanslow is Lifting the Hood on Life. https://mattfanslow.captivate.fm/

– Business by the Numbers with Hunt Demarest: Understand the Numbers of Your Business with CPA Hunt Demarest. https://huntdemarest.captivate.fm/

– The Auto Repair Marketing Podcast with Kim and Brian Walker: Marketing Experts Brian & Kim Walker Work with Shop Owners to Take it to the Next Level. https://autorepairmarketing.captivate.fm/

– The Weekly Blitz with Chris Cotton: Weekly Inspiration with Business Coach Chris Cotton from AutoFix – Auto Shop Coaching. https://chriscotton.captivate.fm/

– Speak Up! Effective Communication with Craig O’Neill: Develop Interpersonal and Professional Communication Skills when Speaking to Audiences of Any Size. https://craigoneill.captivate.fm