Do you mix your money with your company? Don’t do it!

Separating personal finances with those of your company is one of the biggest challenges facing an entrepreneur. If you have this problem, here are some tips.

If you have a small business, should you pay yourself a salary? Of course, It is important to do so to calculate the costs well, it is possible that at a very early stage you omit it, but it is not advisable to do so for long.

What would this salary depend on, or on what basis could you define it?

We should be aware that when starting a company, or a business usually we should wait a few months (depending on the turn) in which we begin to perceive profits, while that happens, everything is investment, blood, sweat, tears, fun and learning.

When doing the cost planning of the company, we must include our salary, which should be an average employees’ salary with a similar position in other companies. Although we have not actually paid yet, we must make a correct calculation of costs, equilibrium point, and estimated time of return on investment.

If we must assign a salary but always with the aim in accordance with the profits that are being perceived. It is likely that in the beginning of the company is complicated, or that is not in line with the efforts or amount of work, however, as the months’ pass by, and the profit increase, this must be adjusted.

If I need money for my company, can I take my personal money?

Yes, but we must analyze before. One thing is calculated risk, and another stupid risk. If this risk calculation has already been made you can take the money from your personal account to invest it with a view to returning it within a reasonable time.

And remember that when 100% of your assets are tied to your company you are completely exposed to an eventuality, and remember that when 100% of your assets are tied to your company you are completely exposed to an eventuality, so try not to.

If I need money for my personal expenses, should I take it from my company’s profit?

Preferably not, if we already assigned a salary this would not have to happen, but there may be situations where it should be done by an emergency or unforeseen, however, you have to try to keep going because you can affect the company’s finances.

Remember that healthy personal finances are basis for those of the company, otherwise, the imbalance can lead to personal and business bankruptcy.

What steps or actions must a person take to not mix these two areas expenses?

Taking a personal finance course will make the good financial habits of an entrepreneur, or business person transfers to the company.

You can also have two bank accounts. One for your company, and another personal. You can also make your personal budget, and create an emergency fund, can make the differences.