Most business owners pay themselves the wrong way and don’t even realize it.
Not because they’re careless. Because no one ever explained the difference between what they do, what they own, and what they govern.
If you’re like most founders, your income is a mix of direct deposits, irregular transfers, and whatever’s left after expenses. That’s not compensation. That’s drift.
The 3 Roles You Play and What They Should Earn
If you own a business, you’re wearing at least three hats whether you realize it or not:
Shareholder
This is the money your ownership earns. It’s not tied to hours or tasks. It’s tied to profit, just like any other investment.
Paid as: Distributions or dividends
Frequency: Quarterly or when retained earnings allow
Board Member
If you’re shaping long-term direction and holding the business accountable, you’re doing board-level work. Even if your board is just you.
Paid as: Strategic stipends or annual board compensation
Frequency: Annually or quarterly
Employee
This is the part most owners only get half right. If you’re running sales, ops, or finance, that’s a job. It needs job-based pay.
Paid as: Salary or W-2
Frequency: Every pay period, like any other employee
Why It Matters
When you blur these lines, your business data gets distorted.
Margins look inflated. Distributions get mistaken for payroll. And forecasting becomes guesswork.
It also makes it impossible to step away. You can’t delegate “owner energy,” but you can assign a clearly defined role with clear financials.
Where Our Services Come In
Many of the businesses we work with already have a bookkeeper. What they’re missing is the layer between the books and the boardroom.
This is where our monthly financial review service fits in. We review the actual numbers, clean up how compensation shows up in reporting, and help owners understand what they’re earning in each role.
We call it reporting support, but clients tell us it feels more like a reset.
Want a Quick Breakdown?
In our latest Business Bytes video, Cass breaks down how to separate your pay as a shareholder, a board member, and an employee.
It’s a quick watch, and it may change how you see your own income.
If your reporting doesn’t reflect what you do or what you’re worth, let’s fix that.
Contact Nexagy to review how owner compensation fits into the bigger financial picture.