How Credit Cards Empowered These Parents To Achieve Business Success

Many people still believe that having debt is always a bad choice. However, after attending a short course on entrepreneurship, I learned an important distinction: not all debt is bad. In fact, there’s a clear difference between good debt and bad debt.

Good Debt vs. Bad Debt

Bad debt is money borrowed for personal wants, leisure activities, or luxuries beyond one’s means–expenses that don’t add long-term value. In contrast, good debt is an investmentin your future, such as loans for education, a home, or a business.

What About Credit Cards?

In popular Facebook group KasKasan Buddies (Credit Card Hacks and Promos), which has over 700,000 Filipino members, many Pinoys share some tipid hacks, promo discounts, and ways to maximize rewards using credit cards.

One member explained the difference between good and bad debt this way:

"One example of a good utang is something that you purchase via credit card, but at the same time, you also have that same amount in cash. For example, getting a new phone or appliance via installment for purposes of credit card points, credit score, and rewards but you're also capable of paying them in cash. On the other hand, bad utangs are those borrowed money to pay another debt (debt consolidation is another thing tho), or those used for gambling or vices, and of course, those utangs that you don't have any intention to pay."

Other members also shared their definitions of good debt:

• "Good debt is used to generate income. Bad debt for luho, which is beyond your means."
• "Good debt is also paid off before the due date."
• "Good debt increases value or earns enough that can cover your monthly amortization + profit." 

Inspiring Moms Share How They Smartly Leveraged Debt:

The Ofilias Family and their Trucking Business

Mommy Celyn Abueg-Ofilas and her husband are both working professionals, with Mommy Celyn working in accounting, and her husband as an IT professional.

Like many others, they also wanted additional income streams to support their family, such as a side hustle or a side business. They now have parking space for rent, an Airbnb condo rental, a digital marketing sideline, and a trucking business. In one of her trending posts on Kaskasan buddies, she shared how they started their trucking business:

“Year 2022 naghahanap kami ng negosyo na pwede naming gawin kahit na both working kami ni husband. We are both working from home and with 2 kids and no yaya kaya ang negosyo namin ay dapat yung kaya din namin imanage kahit nasa bahay lang. Naisip namin ang trucking kasi basta may funds, driver, truck at vendor ka lang aandar na. No need na asikasuhin namin physically. Using my husband's 13th month, some of my extra cash at majority sa CC na suki kami sa mga cash to go, naglakas kami ng loob bumili ng truck. 920k cash yung una namin binili kasi kung hulugan ang laki ng interest plus ang laki ng mga insurance na need bayaran,” she narrated.

They also ensured that they paid their monthly amortization for the truck and thought that at first, it would just be break even. After a year, they were able to pay the truck in full via credit card, and then they bought another one. When we asked her how the trucking business earns now, she said they partnered with seller hubs and brought parcels from one warehouse to another. 

In terms of getting loans, they take advantage of credit cards to leverage and earn more while they can: "We are grateful for the work, business, and extra sources of income while still being hands-on with our kids. We are living our dream but still aiming for more with God's help."

Gina Dela Cruz and Her Retail Business

Mommy Gina Dela Cruz owns Buy Me Na, a business selling affordable and authentic body care products such as fragrances and lotions.

"[I] started a small online business in 2016 using my credit card. I have BDO, BPI and Citi pa noon with as low as a 300k limit combined. We started for only ~100k+,70k dito ipon from coop. Takot pa ako mangutang this time. Employed pa kami both ng hubby ko,” she shared in her post. 

In 2017, Gina lost her job but got a huge amount of money from the company, which she used as capital for the business. Even though she had cash, she used her credit card to purchase and pay for additional stocks. She utilized the "pay later" option to earn points, rewards, and freebies. In 2018, her husband also lost his job but got severance pay which they added to their business funds. That same year, six credit card companies approved her applications with huge credit limits. She shared:

“Kaya naman, kaskas ako ng kaskas dito–syempre within the limit lang ng monthly sales ko. Laking tulong ng CC pampuhunan. Napakalaking part ng growth ng business namin na may ganito, makautang with 0% interest. TIP: I keep track sa cut off para mas mahabang terms/days ng payment.” 

Their business continued to flourish and succeed, enabling them to secure a housing loan. They also got their construction needs from credit cards and loans–all paid through business income.

Gina concluded her post with a tip: “Maging wais lang sa pag kaskas. Pag-aralan at pag planuhan ang pagbabayad. Madami pa ding magiging struggles pero kakayanin yan basta napagplanuhan at maging masipag, samahan na din ng madaming dasal at matatapos din ang loans!”

These stories prove that debt, when managed wisely, can be a powerful tool for financial growth. Whether starting a business or growing an existing one, leveraging good debt requires careful planning, financial discipline, and the courage to take calculated risk.

Read here for smart ways to use your credit card.