Dave Says Car Leasing is Fleecing

Posted: Jan 04, 2012 12:01 AM

Dear Dave,

My husband is a landscaper who works for the state. He has his technical license and wants to start a business doing private work as well. What advice would you give to someone just starting out in this field?


Dear Amy,

First, I’d check to see if there are any additional licenses required for doing that kind of work in your state and the cities in which you’ll be operating. You want to make sure you’re starting off on the right foot with any authorities or governing boards.

The next thing I’d advise is to keep it simple. There’s no reason to run out and incorporate or anything like that. It’s a service business, so print up some cards and start thinking about a basic one- or two-page website. Then, once you land some jobs, post tons of pictures of his work. Before and after shots are great sales tools in his industry, so you’ll need to really show off his talents.

Of course, no one will know you’re out there or online unless you really talk up the business with people. And I’m not just talking about homeowners and businesses. You guys need to approach anyone who may be a potential lead—real estate agents, builders, bankers, architects and anyone else who touches a piece of real estate.

When we built our house, the architect recommended the landscaper. So, try to figure out all the connectivity points you can. Then, stay in touch, and buy them lots of coffee and doughnuts!


Dear Dave,

I’m starting a photography business on the side to help generate extra income. I have friends who’ve told me they’d like to use my services. However, I feel weird about charging them, because they’re friends. How do I get past that?


Dear Daniel,

I understand how you might feel weird taking money from friends, yet you’re providing a service, and you’ve opened this business to make money. They’re going to pay another photographer if you don’t do the job, so why shouldn’t they have the fun of working with someone they already know and like?

There’s a psychology at work here.  If you comp or discount them now, they may never see you as a true professional. But if you charge them a fair price, you’ll be establishing yourself as a pro.

Still uncomfortable? Tell them you’ll do the work free of charge this time if they’ll help you find six new clients. There’s nothing wrong with a trade, especially when you’re starting out. Just make sure you get something worthwhile in the deal!


Dear Dave,

Do you have any advice on vehicle leasing for business purposes? I’ve heard that the expense is 100 percent deductible.


Dear Anonymous,

Yeah, and it’s 100 percent stupid, too! “Fleecing” is absolutely the most expensive way to operate a vehicle. What you’re talking about is rationalizing the fact that you want a vehicle you can’t afford. It’s a bad idea.

Dr. Tom Stanley interviewed tons of millionaires while he was writing his book, Stop Acting Rich. In the process, he found out that 80 percent of them had never leased a vehicle. What does that tell you? It tells me if you want to be rich, you need to do what rich people do—and they don’t lease their vehicles! Plus, I really don’t care if it’s 100 percent deductible. Guess what? I get deductions on the vehicles owned by my company. It’s called straight-line depreciation.

Never lease a vehicle for business purposes. If you don’t have the cash to pay for it outright, then you can’t afford the thing!


Dave Ramsey is America’s most trusted voice on money and business. He’s authored four New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover and EntreLeadership. The Dave Ramsey Show is heard by more than 5,000,000 listeners each week on more than 500 radio stations. Follow Dave on Twitter at @DaveRamsey and on the web at daveramsey.com.