Even The Banks Know That You Are Entitled To A Paycheck
Just about every small business owner I have ever talked to has told me they are either not taking a paycheck, or they are taking a very small one and cannot really live off it, or worse, they are putting money into the business on top of not taking a check. Self-sacrifice is the way of the small business owner. It is a knee-jerk response to cash flow issues and the banks love it as they see their job as squeezing every penny out of you they can. Typically, the owner is not taking a paycheck, yet is paying their debt to the bank, using what should be their pay as the way to support the obligation.
To the small business owner, not taking a check seems like a demonstration of how much they care, how unselfish they are and how committed they are to paying their debts and supporting their business, as if this benchmark is important to anyone. The reality is exactly the opposite. You are entitled to a paycheck. You are working and that is the way of the business world. Will your sacrifice result in saving the business? Of course not, it is merely an act of sacrifice that somehow makes you feel as though you are doing the right thing, sacrificing yourself and your family as if this is a noble cause and the right path to take.
In most instances, I immediately put the owner back on the payroll. How can the business possibly succeed if the owner is flushing himself down the drain?
The second reality is, I have never seen a bank oppose or object or even comment on the owner’s resuming payroll for himself, under our instructions, because the banks also get it and understand that any working person is entitled to a paycheck and that no bank can ever interfere or object to such a scenario. It is the law of the land, irrespective of what the circumstances may be. In fact, even in a liquidation plan for the benefit of the bank, and even if the owner has not taken a paycheck for years or months, we put him back on immediately with no exception or objection ever from the bank.
Take a paycheck. If the business cannot provide one, shut it down or pay someone else less (like the bank). Find it somewhere else, or shut the business down. There is no point in working and not getting paid, it is a matter of survival. If you get trampled, how can the business survive? It makes no sense, yet small business owners do this all the time. Take a paycheck that is enough to live on. It is the only way to go and your banker will support this action. There is nothing gained by not taking one, other than a belief that you are demonstrating sacrifice, which you equate with doing the right thing, but it’s not. It is a ridiculous emotional decision that needs to be rooted out and reversed. You are working and it is important that you take a paycheck.
