BENEFITS

New BusinessBENEFITS

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  • How to Figure Out Your Own Compensation

    Game Plan

    In-Depth

    Postpone Payment (Use It as a Loan to Your Company)

    AdvantagesAdvantages

    advantages

    This is a creative and flexible compromise solution.

    • Eases financial burden. The company has limited resources now, so anything that eases overhead can help.
    • Recognizes your need for fair compensation. You make a sacrifice by deferring compensation, but you receive it eventually.
    • Shows smart management and long-term commitment. This helps the company survive and shows your commitment to its long-term success.
    DisadvantagesDisadvantages

    disadvantages

    It could create additional administrative tasks.

    • Possible tax or accounting issues. You’ll need to talk with your accountant or attorney about how best to arrange a loan to the company, how to account for it, and any tax consequences.
    Deciding FactorDeciding Factor

    deciding factor

    • Are you able to lend the company money (i.e. – defer payment)?
    • How important is it for you to receive a higher salary, even if it is deferred?
    Game PlanGame Plan

    Game Plan

    Next steps:

    • Talk with your accountant or lawyer.
    • Discuss this with your spouse or partner, if you have one, to make sure they are willing to make any necessary financial sacrifices.
    • Plan to revisit this arrangement once the company is more financially secure.