Why you should pay yourself first in your tattoo business - Tattoo Business For Profit Why you should pay yourself first in your tattoo business

Why you should pay yourself first in your tattoo business

Posted on: January 29th, 2014 by Hayley James No Comments

Pay yourself first. That’s what the oldest sages of finances tell us to do. But we find it difficult to do so. Or we often ignore this fact.  When payday comes, the money is always used someplace else and finds its way elsewhere instead of paying ourselves first.

The thing is this could be a habit we can all learn regardless of whether you are in business or not—before you pay your bills, before you buy groceries, before you do anything else, set aside a portion of your income to pay yourself first which can also be converted into your savings. This habit if developed early can establish tremendous wealth.

So, why pay yourself first?

1.       When you pay yourself first, you’re giving priority to your most valuable resource—YOU! It’s a way to tell yourself that you are the most important aspect in your business. That without you your business won't thrive at all. And it's so true. So you deserve to be paid first and foremost. 

This can be a powerful motivator on your part. If you begin to treat yourself as someone important, it will empower you to be one. 

2.       Paying yourself first is a sign of a healthy financial habit and a healthy business. The usual equation is:

income – expenses = savings (or in the case of buisness – profit)

The problem with this scenario is usually having little (or nothing at all) left after you’ve paid the bills and other stuff. But if you arrange the order and place yourself to the front —

income-savings = expenses

then, you’re able to set the money aside for yourself before you find reasons to spend beyond your means.

3.       When you pay yourself first, you can use this money as your emergency fund or a cash buffer. Most financial advisers would tell you to have a six-month income emergency fund which you can use to deal with unexpected circumstances. Paying yourself first gives you the opportunity to raise this fund.

The real hindrance to developing the habit of paying yourself first is not finding the money to save. Many people think their salary is not enough. The truth is almost everyone can save at least 1% of their income. Even if some will say that saving this little is meaningless. And yet if you try to think about it, saving just 1% of your income, for the purpose of habit forming, is not an impossible feat at all.  Maybe next time you can try to pay yourself 3% or 5% from your income. Then, you can raise it up slowly.

The challenge therefore is not the money at all. It is you and your discipline to do it.

Image courtesy of Stuart Miles / FreeDigitalPhotos.net

 

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