I’ve been running my solo gig for a while now, but I’m still not sure I’ve got the whole ‘paying myself’ thing down. Sometimes I just transfer whatever’s left after expenses, other times I try to stick to a fixed amount.
Curious how other freelancers handle this. What’s your approach to owner’s draw or salary?
I’ve tried a bunch of ways over the years. Now I keep it pretty straightforward.
I pay myself a set amount every month. It’s not huge, but it covers my bills and a bit extra. The rest stays in the business account.
At first, I’d just grab whatever was left after expenses. Bad idea. Some months were great, others I was scraping by. Made personal budgeting a nightmare.
Now, I look at my average income over 6 months, subtract regular expenses and a buffer for surprises. That’s my monthly pay. It goes into my personal account automatically.
If there’s extra at the end of the quarter, I might take a bonus. But mostly it stays put for slow times or buying new equipment.
Oh, and I learned to set aside money for taxes every single month. Trust me, you don’t want to get caught short when tax time rolls around.