How much should you pay yourself?

Image courtesy of David Castillo Dominici at freedigitalphotos.net

Image courtesy of David Castillo Dominici at freedigitalphotos.net

Well, it depends. If you have ever been a business owner you know what we mean. Technically speaking you should get paid what you are worth but as a business owner there are many variables that need to be considered.

One very important consideration is to pay from the profits, ONLY. It can be difficult to watch the money come in and think WOW I got it made! But if your expenses are large you really don’t. So be careful to only pay from the revenue minus the expenses or the profit.  Remember to include TAXES in your expenses.

In some legal business structures the business owner’s pay might be restricted. For instance, if the business is incorporated and there are stockholders, usually the business owner is on the payroll, like an employee. Conversely in a sole proprietor situation you can pay yourself whatever you want!

As a business owner, do you feel you are paid enough? Please comment.

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