The salaries of my employees will be paid out of the revenue, but what about my salary?
Your employees get paid on a set date. You don't. Here's why that keeps happening, what it costs you, and one small step to change it today.
What you need to know
- Most small business owners treat their own salary as whatever is left over. There is rarely anything left over.
- The behaviour behind this is well understood. So is the fix.
- You do not need consistent income to start paying yourself. You need a system that works before the money arrives.
If you run a business with staff, you know exactly how to pay them. The date goes in the diary. The number is agreed. The money goes out. No one asks whether there is enough first. It just happens.
Now think about your own pay. What is the process? For most small business owners, there is not one. There is just whatever is left at the end of the month, and honestly, most months there is not much left.
You are not bad at this. You have just never been given a way to think about it that actually works.
So this post is going to show you why your salary keeps getting skipped, what is happening in your head when the money lands, and one thing you can do today to start changing that.
The quick answer
Your employees get paid because there is a process that runs whether you think about it or not. You do not get paid because there is no process for you. The fix is to build one before the money arrives, not after.
What you might be telling yourself
“My income isn’t consistent enough to pay myself a salary.” Inconsistency is real. But waiting for a consistent month to start means you are always waiting. The system has to come first, then it smooths the inconsistency out.
“I’ll pay myself properly once the business is more stable.” The business feels unstable partly because you are pulling from it in an unplanned way, or not paying yourself and then emptying the account in a panic. Stability comes from the structure, not the other way around.
“The money is just gone by the time I get to myself.” Yes, because you come last. That is a design problem, not a discipline problem. You built a queue and put yourself at the back of it.
“Some months I genuinely do have to empty the account just to cover the bills.” That is a real and serious version of this. And it usually means the business and your household money are tangled together, which makes it harder to see what is actually happening.
“I feel like I’m always behind, no matter how much comes in.” That hum of panic in the background is exhausting. It does not mean you are doing it wrong. It means there is no signal telling you what is safe to spend and what is not.
“The more I make, the more I seem to owe.” That is what happens when tax is not being set aside as the money lands. Revenue goes up, the pot stays mixed, the bill arrives later and it is always a shock.
Why this hits business owners harder
When you are employed, someone else runs the process. Your pay lands on a date. Tax comes off before you see it. You know what you have.
When you run your own business, none of that happens automatically. Money comes in lumps. A big invoice lands one week, then nothing for three. You are the one who has to decide what is yours, what belongs to the business, what needs to go to tax. And you have to make that decision fresh every single time, usually when you are also trying to run the business.
No one pays you a wage. No one sets aside your tax. No one tells you what is safe to spend. So most people do what feels safest: leave it all in the pot and pay the bills as they come. That way you never accidentally spend something you needed. Right?
Except what actually happens is you never see yourself as a priority, so you never pay yourself, so you never feel financially stable, even in a good month.
A scene you will recognise
It is the first week of the month. A decent payment lands. You feel good for about four hours. Then you start doing the maths in your head. Suppliers. Software. That invoice you forgot about. Maybe staff. You transfer what needs to go out. What is left does not look like a salary. It looks like not much. So you leave it there, in case something else comes up. A few weeks pass. Something does come up. The money is gone. You never paid yourself.
What you are dealing with there is a sequence problem. The money is going out in the wrong order, and you are always last.
What happens to the money once it lands
This is the part most people never see clearly. Revenue is not profit. Profit is not your salary. Your salary is not what is left over.
When money lands in your business account, it is already owed to several places: your suppliers, your staff, your tax authority, the running costs of the business. If you do not ring-fence your salary before any of that happens, it will get absorbed. Every time.
The way to see it: when an invoice is paid, that money is already spoken for in four directions. Staff and suppliers. Tax (moved aside immediately, not at the end of the year). Business running costs. And you.
If you do not make that split the moment the money arrives, the default is that everything piles into one pot and you spend from it in whatever order the bills come in. Your salary is rarely the most urgent-feeling bill, so it keeps getting skipped.
The behavioural ideas behind it
There are two that matter here.
The first is mental accounting, which Richard Thaler described as the way we file money into mental pots, and how the pot we put money in changes how we treat it. When your salary, your tax, your supplier payments and your business buffer are all sitting in one account, your brain cannot tell them apart. It just sees a number. And that number feels like it belongs to the business, not to you. Separate the money physically, into different accounts with different purposes, and your brain treats each pot differently. The tax pot feels untouchable. The salary pot feels like yours. That is how mental accounting works, and you can use it deliberately.
The second is defaults, studied by Brigitte Madrian and Dennis Shea, who found that whatever system you set up in advance is the one people stick to, even when they have the option to change it. The employees you pay are on a default. The date is set, the amount is agreed, and the system runs. You need the same thing for yourself. Not a decision you make each month when you see what is left. A default that runs whether you think about it or not.
If you want to go deeper on why income irregularity makes all of this feel so much harder, How do I budget when my income is different every month? is worth reading alongside this.
One small step to try today
Before you do anything else, write down one number: what would be the minimum monthly amount that, if it landed in your personal account reliably, would take the edge off the panic?
Not what you want to earn. Not what you think you deserve. The floor. The number that would make the background hum quieter.
Write it on a piece of paper, not in a spreadsheet. Just the number. Then keep it somewhere you will see it this week.
That number is what you are building toward. You do not have to transfer it today. But naming it turns it from a vague wish into something real. And that is where the behaviour starts to shift.
For the tax side specifically: talk to a qualified accountant in your country about how to structure what you set aside. The general behaviour, moving a percentage of each invoice into a separate pot the day it lands, is sound. The exact percentage depends on your situation and your tax rules, and that is a conversation for a professional who knows your numbers.
Ready to go deeper?
Join the Thursday Money Note, two short emails a week on money and how we behave with it, free.
Or if you want to work through this properly, book a free Cash Flow Session to find out about The Money Story Method, my 12-week 1:1 programme.
Joel
Questions people ask
Why do I always end up with nothing left to pay myself?
Because your salary has no protected slot in the process. Every other cost, suppliers, staff, tax, software, comes with a date or an invoice attached. Your pay does not, so it gets absorbed. The fix is to move your salary allocation the moment revenue lands, before anything else.
How do I pay myself a salary if my income is irregular?
Start with a floor, the lowest sustainable amount, and pay that consistently. In a stronger month you can top it up. This is steadier than paying yourself whatever is left, which is usually nothing. A qualified accountant can help you work out the right structure for your situation.
Should my salary come out before or after tax?
The order that tends to work behaviourally is: revenue lands, tax allocation moves to a separate pot immediately, then your salary allocation moves to your personal account on a set date. What percentage goes to tax depends on your country and your setup. Speak to an accountant for the specifics.
Why does it feel like the more I earn, the more I owe?
Usually because tax is not being set aside as the money arrives. Revenue grows, spending follows it, and then the tax bill lands later and feels enormous because the money has already gone. Moving a tax allocation the day each invoice is paid is the behaviour that breaks that cycle.
Is it normal to feel scared about paying myself a proper salary?
Very. A lot of small business owners worry that paying themselves will somehow break the business, or that they do not deserve it yet. That fear keeps them last in the queue indefinitely. Paying yourself a consistent, planned amount is part of the structure that makes the business sustainable. It is not a reward you unlock later.