A friend of mine was in this situation once. He had an LLC that was making good revenue but all of it was being used to grow the business. I don’t know if the laws are still the same, but back then because it was a single owner LLC all the profit counted as income for my friend. On paper he was making loads of money, but in practice he was still eating ramen and renting a small apartment.
Yet, he was building capital. If you try to put away as much money as possible by living as frugally as possible, that does not make your financial situation ‘bad’.
My last boss was a bit like this.
He owned a small company with 7 employees, paid himself less than he paid us, and was in more debt than his house was worth.
So on paper he had less income and a lower net worth than me.
But he still lived in a big house while I was renting.
And the company was growing as well.
I still wouldn’t want to trade places with him.
I like my 30 days off plus sick days, where I can turn my phone off.
A friend of mine was in this situation once. He had an LLC that was making good revenue but all of it was being used to grow the business. I don’t know if the laws are still the same, but back then because it was a single owner LLC all the profit counted as income for my friend. On paper he was making loads of money, but in practice he was still eating ramen and renting a small apartment.
Yet, he was building capital. If you try to put away as much money as possible by living as frugally as possible, that does not make your financial situation ‘bad’.
Bad isn’t the stipulation, paycheck-to-paycheck is. And has said that if covid had hit back then he would have been couch surfing within a month.
My last boss was a bit like this.
He owned a small company with 7 employees, paid himself less than he paid us, and was in more debt than his house was worth.
So on paper he had less income and a lower net worth than me.
But he still lived in a big house while I was renting.
And the company was growing as well.
I still wouldn’t want to trade places with him.
I like my 30 days off plus sick days, where I can turn my phone off.
When you invest money back in the company that’s either R&D or capital expenditure, both are tax deductible and don’t count as profit.
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