The short answer
Learn how founders should balance personal and business goals when deciding how much to pay themselves and where to direct their profits.
How Should Founders Decide What to Pay Themselves?
Every founder should get paid. Without it, exhaustion, burnout, and resentment towards the business can quickly take hold. How much you take out comes down to the tension between your business goals and your personal goals.
Some founders prioritise personal wealth and the lifestyle that comes with it. They release profits from the business to invest in property, shares, or other assets that bring them enjoyment. Others are deeply passionate about growing their business and choose to reinvest the majority of their profits back into it. Both approaches are valid, but each requires a clear understanding of what you actually want from life.
The risk lies in sitting between the two without a clear direction. Taking out money and then regretting not reinvesting, or reinvesting heavily and feeling you missed out on personal milestones, can both lead to dissatisfaction. Knowing yourself and your personal goals is the foundation for deciding where your profits should go.
Key takeaways
Every founder should be paid; not paying yourself leads to burnout.
Decide whether personal wealth or business growth is your priority right now.
Clear goals stop you regretting either choice later.
Read next: the 3-bucket framework for managing profits, how much to pay yourself when starting, and our property wealth planning.
Leader of the herd. Shehan's career has spanned professional services, finance, banking, and strategy. He started Elephant to connect busy, ambitious people with the proactive financial advice they need to make great life decisions. He built the kind of firm he always wished existed - and then showed up in trackie-dacks to run it.
