Minimum amount of cash in the bank to start O/O

I've spent 10k since you posted this.... just to put things in perspective.

 

I have gone the HELOC route in the past, but the bottom line is this: you are putting your house at risk for a truck. That's a heck of a risk to take to start a business.

 

I've had $200 after down payment on my first truck. Got Engine warranty gap insurance. Company that leased to gave me fuel card and plate etc. 5 years since then on my second truck. There was no way to collect that much money with 29 cents per mile as a company driver (Like engine over haul, 6 months of cash flow etc) if something bad happens that company you leased to will help you out for sure

 

I agree with you 100% leverage is OK as long as you use it correctly and stay discipline to pay everything back on time

 

I gotcha, it is a risk, but isn't a heloc like a second position loan, not like the primary loan on your home and the heloc cost is only what's used, and it's very minimal, for example 100,000 will only cost $200 monthly, and I don't plan on using nothing near that, if I was to consider, my other option is to use some of my 401K, they allow us to make withdrawals, for certain situations, without being penalize, and you have the option to pay the income taxes up front from the 401k account. Or I can take a 401K loan and pay myself back weekly. There's still other options, just got to utilize my resources. But it's a proven fact there's money to be made in trucking. Just need to buy my equipment, already have my company structured and ready to go. I'll lease onto the company my cousin leases to , he did decent #'s for 1 year his gross.was like. $175,000

 

So how did it go,? Did it work out for you or you almost lost your home?

 

I came within about three weeks of filing bankruptcy. Was able to claw back out of the worst of the hole over about 4 years, but it cost me my marriage, to be frank. Women have a different need for security than men. Something to consider in the bargain. I'm now 7 years further, and it looks like I will be able to pay off the final loans in about six weeks. A lot of stress and worry is disappearing.

Even though a Heloc IS a second position lien, it is a lien, and the bank can, and will, force foreclosure if the terms are not met and there is any kind of significant default balance.

As far as 401K loans, not a good idea. If you leave your job (going to a better job, fired, sick, company bought out, whatever), the loan is due IN FULL in three months, or it is considered a distribution. Resulting in a 10% penalty PLUS it's taxed at your income tax rate.

For the same reason, taking money out of a 401K is equivalent to borrowing money at 35% because of the penalties and taxes it triggers.

 

I personally knew a guy that did a HELOC to buy his truck and start his business. Hes now a company driver again and lost the house a few years back. I would Never recomend putting your home at risk. Get a loan from a bank and make the truck pull its own weight and not risk the house if you fail

 

I disagree, I've had 401k loaks in the past, and had no problems, like this and the company, I work for is a fortune 500 ,trust me they will not get bought out, if anything, they will be the company that bs other companies out, getting fired, , we'll I guessential anthing is possible, but I've been OK for the last 16 years, and I don't focus on the negative, plus a 401k loan allows you to pay taxes upfront, like I said earlier, but if you never experienced this, like, I've done before, then you really wouldn't understand, it's not all cut and dry, like you'll automatically get penalized, there are specifics, and certain circumstances, that allow you to make a withdrawal, without any penalties, and plus when you take a loan, your only, paying yourself, back,. If people will stop putting obstacles in their own way, they'll get much further, but just like any business, no risk, no reward.