Taxes Paid – But Who Will Pay You?
Hurrah! You made it through Tax Season! Let’s take a big inhale…hold…and exhale, letting go of all the remaining angst from taxes. We’re ready to begin planning again, but this time for something that will excite you: your salary.
Just Like Taxes, You Can Plan For Salary
Hey, you are not doing this for free! Yes, you want money for the business to run, but you need income, too. Whether you need money for a serious purpose or a frivolous buy, you still deserve to have an income. Let’s work on your interior design business plan to include Salary.
How To Set Your Salary
Just like planning for taxes, your plan for paying yourself will include the following:
First, decide to pay yourself consistently. Knowing that you and your family can depend on the income you earn is a motivator and a stress reliever.
Next, assess your interior design financial statements. Have an idea of the net profit you are making at all times. That is where your salary will come from.
Now, designate an amount that you will budget toward salary and start paying yourself. If you are not running your salary through payroll, be sure to leave enough to cover your income taxes. Even if you start low, like $500 a month, start somewhere. If you are unsure about how to read the financial statements or how to manage the money – check out the online courses I offer. I will put the links below in case you need them.
Lastly, continue to monitor your interior design gross and net profit margins and adjust at quarterly reviews as needed.
See? Same method as for taxes, only now you are setting aside cash for yourselfto enjoy.
Why You Should Plan For Salary
I mean it: set aside cash to enjoy.None of us work for the sheer joy of expending effort. Really, we work to enjoy life with the income we earn—vacations, shopping, classes, investments, etc. are the fruits of our labors. Eat some fruit!
Truly, being paid regularly (no matter the amount) is crucial to long term success. Money is a great motivator, and if you feel like all your efforts come without anything left for yourself, then you can easily lose motivation. And that would make sense – most of us work for the paycheck, and if you deprive yourself of a salary, then you lose the biggest form of motivation to work that drives just about everyone.
Of course, you chose to start an interior design business because you feel passion for the work, but there are many forms of motivation and all are vital to succeeding. Salary is a big one.
But there’s more. Physically, you enjoy the feeling of getting paid. Endorphins, those little biochemicals that fire off when we feel sensations that we like, release when you get paid. It’s a cycle—the better you feel about getting paid, the more you wantto do in order to get paid. Rather than drudgery of the daily grind, you look forward to putting your nose to the grindstone!
Finally, most importantly, being paid legitimizes your efforts. You really are good, and you really deserve the money earned from your efforts. This eliminates any risk of the imposter syndrome, a false feeling that tricks you into believing you don’t belong in the entrepreneurs’ arena. You’re not a fake; this is your business, you’re running it, and you’re making money from it.
You should get paid for it.
To get assistance with financials, check out the Understanding Your Financials course.
For assistance with implementing a money management system like Profit First, check out the Master Your Profit course.
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