Owner Compensation
When most people can think of their owner compensation, they compare it to salaries in the outside world at similar positions.
There’s a big difference however. Those salaries are for managers and you’re an owner. You’ve got a much higher level of risk as an owner.
So as the owner are you getting compensated for that additional level of risk?
One way to tell is that you’re getting more in the way of compensation than you would be otherwise. Now, perhaps, it might not be from salary. Maybe it could be through dividends or distribution to you as owner. Perhaps, you’re getting greater retirement benefits, more health benefits or other expense reimbursements. Those are all things to factor in that all become part of total owner compensation.
So take a look at the whole picture. Are you getting more in what you’re compensated from the business as an owner or are you really just like an employee? If the latter, is it worth the risk you’re taking on?
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