insurance could be a business expense and so that our personal assets weren’t attached to the business directly and legally. There are a lot of other benefits of the S Corp but I won’t bore you with them! We had been a sole proprietor for a LONG time and we knew the change was way overdue! We wanted to change before Michael even joined the business but guess what happened right about that time… we were building a house… and building a house requires a ton of underwriting if you’re young and self-employed. So switching everything up during that season wouldn’t have been smart. :) Now we’re officially where we want to be legally.
After a CRAZY tax season, this change was very welcomed. So what’s different now? Well, WE GET PAYCHECKS!! That’s the most exciting part! Previously, we just transferred money for our personal life as needed. There wasn’t any structure because I have this crazy obsession with tucking money into both our business savings and personal savings accounts and seeing how much I can put away without needing to use it. It’s not a bad obsession… in fact, it’s the only way we were able to build our new house. However, when you don’t have a system and a structure to your income level (especially when this is your main source of income), it makes it impossible to have a budget. So a few weeks ago, we received our FIRST PAYCHECK! I get one and Michael gets one twice a month. We pay our CPA to manage our payroll so that this change requires no additional work for us. If our business account is running low one month, she has access to our business savings to transfer from there. We sat down and decided on a salary we thought was realistic and anything extra will stay in the corporation. We’re BIG Dave Ramsey fans and so we believe that not only should your personal life have an “Emergency Fund”… but your business should also. So our new system will set us up WELL for both business savings and personal savings.
Michael has been working hard on our “BUDGET” the last few days. We never really had one since we didn’t have a set amount of income each month but all of that has changed! We know exactly what we’re going to make and now we can tithe more accurately, spend more responsibly and saving more regularly. We have big goals financially…. who knows if they’ll happen! But we have a much better chance of reaching those goals since we can actually see what we’re doing with our money. We’re EXCITED about this!! I mean, I’ve NEVER felt like I was ever being PAID for all of my hard work!! Now I feel like a normal person with a paycheck on the 1st and 15th of every month! We announce “It’s PAY DAY” around the house just because we can!!! It’s the little things in life:)
We’re thankful for this change… we’re also thankful for some of the great financial advice we’ve received not only from our CPA but also from our financial advisors… which we’ll have to share more about sometime soon! It’s never too late to start financial planning! Whether you have $50,000 or $500 in savings, it’s still a great thing to do for yourself and a your family!! So happy Thursday everyone! It’s PAY DAY for us!!!!
Ps. That picture? It’s great… except for the remotes. haha Just ignore those:)