The Profit Playbook
The Profit Playbook
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Practical financial insights, strategies, and tools to help business owners grow profit, build equity, and make smarter decisions with confidence.
Building a Strong Emergency Fund for Your Business
Building a Strong Emergency Fund for Your Business
Business emergencies don’t come with warnings. Economic slowdowns, unexpected expenses, or disruptions like COVID can shift cash flow overnight—so every business needs a financial safety net.
This buffer helps you stay stable during slow periods, avoid high-interest debt, and handle surprises with confidence.
Even starting with 5% of monthly revenue can build meaningful protection over time.
Are you paying yourself enough?
Are you paying yourself enough?
Most entrepreneurs either underpay or overpay themselves because they lack a clear, structured approach to owner compensation.
The right amount depends on your business type and revenue, but a useful benchmark is 35–50% of gross revenue for pass-through entities like LLCs, and a “reasonable salary” for S-Corps as required by the IRS.
Striking this balance is important: it keeps your business compliant, ensures you’re contributing properly to taxes, and prevents cash flow strain or underinvestment in the business. When done correctly, paying yourself becomes a strategic decision that supports both personal financial stability and long-term business growth.
Should You Hire a W-2 Employee or an Independent Contractor?
Should You Hire a W-2 Employee or an Independent Contractor?
Choosing between hiring a W-2 employee or an independent contractor is a critical decision for growing businesses. Misclassification can lead to costly IRS or Department of Labor penalties, so understanding the difference is essential.
It largely comes down to control over how, when, and where work is performed. If you direct the process, they are likely employees; if they control their own work, they are likely contractors.
Before hiring, consider insurance requirements, job duration, and financial risk tests to make the right call.
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