I'm digging into a topic that's crucial for every business owner out there – paying yourself. I understand the hustle and grind you're putting into your business, giving it your all. But let's talk truth – if you're not taking care of yourself financially, it's going to be a challenge to go the distance.
Today, I'm bringing you three perspectives on what to pay yourself: from the viewpoint of the Lender, the CEO, and the Financially Fierce Founder.
FIRST OFF, THE LENDER.
Imagine you're sitting across from your banker, who's all business, of course. Your compensation, from their perspective, is a fundamental part of a solid financial plan. They want to see a realistic financial forecast for the business – AND a personal budget. Because, let's face it, financially healthy Founders build finanically healthy businesses.
If you're seeking operating capital to keep the business afloat, be ready to show them your personal budget, outlining exactly how much the business needs to pay you monthly to cover your financial necessities.
THE CEO MINDSET.
As the CEO, you're not just thinking about today – you're thinking long-term stability. Your compensation isn't merely a paycheck; it's an investment in the future success of the company. With this mindset, calculate a fair market rate for your role, considering your worth in the industry and the value you bring to the business. It's not about shortchanging yourself; it's about aligning your compensation with the strategic importance of your role.
Be realistic and budget for the right person or people you would need to hire to replace you.
AND FINALLY, THE FINANCIALLY FIERCE FOUNDER.
As a Financially Fierce Founder, you take control of your financial future. You not only budget for a fair market salary but you also build in a bonus that ensures your personal financial security, accounting for your retirement and savings needs. You understand that neglecting your own needs is a fast track to financial burnout and breakdown.
Stand up for yourself. Recognize you're worth every penny and budget for your baseline needs along with a healthy bonus.
THE BOTTOM LINE IS THIS...
Whether you're looking for a loan, stepping up as the CEO, or channeling your inner Financially Fierce Founder – the bottom line is crystal clear. Pay yourself, and pay yourself well. Because when you're financially thriving, guess what? Your business is thriving too. It's time to take control, invest in your worth, and build a future that's as fierce as you are. You've got this!
ABOUT TAUNYA WOODS RICHARDSON
Taunya is well-known for her straight-shooting, bottom line-building approach to founder finance. As the Founder of Nail The Numbers, she brings 30+ years of experience in entrepreneurship, finance, and neuroeconomics to our mission of strengthening the minds and bottom lines of Founders across North America.