As the owners of the business, Tom and I have always paid ourselves last and we believe that, so long as you can manage your personal finances to get through times when cash is a bit short, then there are real tangible benefits to paying yourself last.
1. Happy people = business success
People are the greatest asset to any business and should be treated as such. When staff and suppliers do good work for you, they deserve to be paid promptly. This shows that you value them, makes their lives easier and means that they’ll be happier working with you. The result is stronger, longer working relationships, with everyone working as a team towards the success of your business.
2. Reducing financial liability
Far too many small businesses get into financial trouble or go bankrupt because they can’t pay their staff, or suppliers’ debts. Paying yourself last minimises the financial risk to the business, by making the payment of liabilities your priority.
3. Peace of mind
There are lots of things to think about when you run a business. As a manager, the less you have to worry about, the better you perform. Paying staff and suppliers promptly means that it’s a job done, you know exactly where you stand financially and you don’t need to worry about putting others under financial stress. As a result, you are able to stay focused on what’s important – growing your business for long-term success.
If you just want to make a quick buck, then paying yourself first probably does make sense but if you’re trying to build a resilient, long-term business, then paying yourself last can actually be a very effective strategy.
What do you think? Would you consider paying yourself last (if you don’t already)? We’d love to know your thoughts!
