Knowing how to pay oneself appropriately is crucial for the long-term success, even if it’s simply a tiny sum that increases over time.
Zahir Khoja, CEO of Wave Financial, a provider of financial management software for small businesses, stated that not taking any action “doesn’t reflect the genuine health of your firm.” As their companies grow, many small business owners struggle to determine an adequate take-home wage, and some don’t even pay themselves. A 2022 small company survey from Wave found that 26% of small business owners don’t pay themselves a wage, making the mechanics all the more crucial. These four suggestions are for small business owners to think about when determining their take-home income.
- Consider the total financial situation first
- Don’t underpay yourself
- Make pay as regular as it is for any employee
- Benchmark business founder pay