Debts. Just the thought of them makes us sweat and feel nervous, don’t they? Still, as uncomfortable as that topic may be, it’s a conversation that needs to be had, and even more so when businesses are involved.


Paying off debt can be frustrating and confusing if you don’t have someone to guide you through the process. But if you know you are ready to take the next step to finally get that financial freedom you deserve, keep on reading because this interview is all about eradicating debt, once and for all.


Susanne Mariga is the host of Profit Talk Podcast, a public accountant, tax coach, certified Profit First professional at the Mastery level, and overall, she has experience helping thousands of clients achieve their business goals. She’s here today to share with us an easy 4-step method that will help you get rid of debt. So continue reading!


Using debt to grow your business, big no-no


Amalie: Let’s start with your philosophy on debt, and tell us in what situation is accumulating debt okay.

Susanne: I feel very strongly against that because one, you start to enter on a cycle. It’s always a catch-up cycle. My personal opinion is that debt is never really okay. I’d rather you grow slow and own your business versus constantly owing the man, as they say. Now, if you are going to get debt and it is something that you want to do, I think the big thing is ROI. What is the guaranteed return on investment? What is the guarantee that you are going to get if you accumulate debt? So if you’re spending on marketing and you’re spending on advertising and you’re spending it on new startups, there’s a chance that you might not be getting that back. And so return on investment is extremely important, especially right now, when you see people getting EIDLs and other lines, what is the return on investment for every dollar that you’re taking out? What is the amount of growth that you are going to see in terms of revenue, as well as profit?


Amalie: So, if you are investing in something, is there a timeframe that someone should see a return?

Susanne: The problem with debt is that you’ve already spent it. We already spent it before you get it back. You’re already paying in some ways. So if you’re paying for marketing expenses,  you’re already spending the money before you’re going to guarantee to get it. I know that with marketing, we obviously want to see a 10 times ROI on it, but again, you already spent the money. I would rather you take money from your retained earnings. I would rather you take money from your profit.


4-easy steps to pay down your debt


Amalie: Let’s talk to the people who have debt and what to do to get rid of it.

Susanne: I think there’s really four major steps. There are like teeny steps in between, but there are four major steps to debt eradication. 


1st step: First of all, when you’re in business, price your service right. Make sure there’s enough margins and profit in there to really be able to build and retain earnings so you don’t have to go into debt in the future. Make sure there’s margins in there that you can not only get a profit but accumulate and retain earnings. You’ll have money that you can reinvest in your company if you’re pricing right.


2nd step: It starts with a conviction.  Realizing that there are ways that I can accomplish what I want, just in slower gradual steps.

You have to have conviction and say, “This is not how I want to grow my business. This is not the legacy I want to leave. I want to be able to grow. I do not want to be a slave to the lender.” 


3rd step: You got to cut the cards. Get rid of temptation, move it far away. Cancel those lines of credits, put them in the freezer. Because again, as long as those options are open, you will always be short one month. 


4th step: I highly recommend what we call the debt snowball. The debt snowball. What that means is we have the five bank accounts: the income account, the operating account, the profit account, the tax account, the owner’s pay account. And we’re literally allocating money to these by purpose. That money that you’re putting into your profit account, at the end of the quarter if you don’t have any debt, we put half into the owner’s distribution. Then the owner can go on vacation and do whatever he wants with it. And the other half goes into what we call retain earnings. It’s for those rainy days or those big investments that might come up through the pipeline later on. 


But what happens if you have debt, instead of rewarding the owner immediately, we have to delay gratification and we take half of that profit that’s been accumulated in that account and we put it towards our smallest debt, and every quarter we pay off our smallest debt. Then once that smallest debt is paid off, we then put it towards the next smallest debt. And so we keep putting it there until that debt is paid off, and so on.


Why implementing the Profit First system can be life-changing


Janine: Share with us a story with your clients and profit first, like before and after profit first.

Susanne: It’s an amazing cash management system. I always clarify, it’s not an accounting system, it’s a cash management system. I’ve gotten to work with hundreds of clients and implement the Profit First system. I’m actually writing the next book with Mike Michalowicz, we’re going to release it in June 2021.


One of the things that hit me a few weeks ago is that we weren’t just changing people’s lives. We thought we were changing people’s lives by giving them a cash management system, but then it occurred to me that we are changing legacies. We were changing people’s legacies.

I think that has been the most beautiful thing about Profit First. I had a client that was running a million-dollar loss a year, but that’s what happens when you’re in a $30 million revenue game. If you’re in a $30 million revenue gain and you’re financing your business, you can run a million-dollar loss. And literally within the first quarter to have them have a 300,000 of profit, it was significant for them. What we did was we restrategized, we retargeted who their customers were. We helped them niche and we raised their prices. 

And again, we’re not just changing lives, we’re changing legacies because we’re giving their children debt-free businesses. We’re giving their children the opportunity to go to college. And then when you mix tax strategy with that, it’s compound impact.


We actually have a free Profit First Master Class that we teach, and we have one that’s coming up in September, and what they need to do to find this master class is go to It’s a five-day masterclass, one hour per day, one hour each, each day of the week, and we literally go over one core concept of Profit First and how to implement that in your business. 


And that’s it for today! We hope this interview has been helpful to you. See you on the next episode!


To listen to the full episode click here.


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