The EntreLeadership Podcast

Why Making a Profit Isn’t Enough to Survive in Business

Dec 18, 2023

Learn about a struggling business owner making millions, effective team bonus structures, dishonest gym owners, and how to determine your own salary as a business owner. The podcast also covers real estate business risks, navigating financial challenges, generating revenue, and negotiating business valuations.

48:59

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Quick takeaways

When determining how to pay yourself as a business owner, you can choose between owner payouts or W-2 wages, each with different tax implications and considerations.

As your business grows and cash flow becomes more stable, it may be more beneficial to establish a regular salary through W-2 wages and take a bonus at year-end to ensure sufficient funds and reduce reliance on owner draws.

Deep dives

Choosing the Right Salary Structure

When it comes to paying yourself as a business owner, whether through owner payouts or W-2 wages, the tax implications are the same. Paying yourself through owner payouts means paying self-employment tax on your business income, while paying yourself through W-2 wages results in you and the business each paying payroll taxes. The choice between the two depends on personal preferences and the financial structure of your business.

Introduction

2min

Real Estate Business and Contract Houses

6min

Navigating Financial Challenges and Funding Projects

4min

Structuring Fourth Quarter Bonus

11min

Generating Revenue through Launching and Quality

4min

Negotiating a Purchase and Valuation

18min

Today we’ll hear about:

• A business owner who made $8 million last year but is going broke

• The best way to structure bonuses for your team that doesn’t negatively affect your profits

• Someone wanting to buy a gym, but the current owners aren’t being honest

• What to take into consideration when determining how to pay yourself as the owner of a business

Links mentioned in this episode:

• The EntreLeadership Podcast

• Stages of Business Assessment

• Have a question for The EntreLeadership Podcast? Leave a voicemail at 844.944.1070 or submit your question for a chance to be on the show with Dave Ramsey: https://www.entreleadership.com/ask

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