Most small business people never ask themselves how much the business they’re in ought to pay them. Here’s a primer to guide them.
If you have borrowed or invested risk capital to get into the business, you should be compensated each year for lost interest earnings, had the capital been invested elsewhere.
Secondly, you should be repaid for the time you put in at work, or the work members of your family and friends contribute.
Remember: Funds you have borrowed for a business are to be repaid from after-tax earnings.
What you come up with you may surprise and possibly make you feel cheated. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)
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