CentreO Blog

As business owners we want the best for our companies. And more often than not, we are willing to make all sorts of sacrifices, even our own salaries.

But just as any member of your staff, you are working for your business. And you should be getting paid. The question is  – how much?

By the Numbers

Base your monthly salary on the lowest monthly earnings from the previous 12 months, not the highest.

The National Federation of Independent Business says that, as a general rule, owners of profitable small businesses don’t take more than 50 percent of profits for themselves.

Start an emergency fund. Try to keep a minimum of one month of expenses in the business, just in case

The thing is, you definitely did not launch a business to make less money that in your last job. The whole point is to lead a better life, right? And you should not feel guilty about assigning yourself a suitable remuneration. Just be reasonable.

Pay yourself what you are worth

Make use of online resources, like Salary.com or Glassdoor.com to discover what is the typical salary for people in your position, industry and geographic region.

Make every month a bonus month

Many business owners pay themselves what’s left at the end of the day, after all the expenses have been paid. It is a fair solution but do expect your salary to vary month to month. 

Pay yourself the absolute minimum

If your business is in growth mode, consider paying yourself the bare minimum (enough to cover the important bills and some daily expenses). Try to put as much money as you can back into the company. However, be sure you are working towards a plan to pay yourself. Your salary should be growing along with your company.