Free calculator for agency owners
How much can a marketing agency owner pay themselves?
An agency owner often takes pay last, after the team. What you can take depends on profit after payroll, and on the cash tied up in unpaid invoices.
The starting numbers are an example for a marketing agency. Replace them with yours.
Three rules for paying yourself from a marketing agency
- Base steady pay on average profit across several months. One big project month is not a raise.
- Take extra draws only when unpaid invoices are under control.
- Personal taxes come out of what you take. Ask your accountant how much to set aside.
What changes the answer for a marketing agency
An agency owner's pay is usually what is left after the team. That makes it easy to skip pay in a tight month, then overpay yourself after a big project. A steady amount from average profit is better for both you and the agency.
The worked example
In the example, the business keeps $82,000. That covers $60,000 for two payrolls, $12,000 of monthly bills and $10,000 due soon. Steady pay comes to $12,800 a month. Anything above $82,000 in the bank is spare.
A common question
Should an agency owner pay themselves a salary?
A steady salary from average profit, plus profit distributions after the books close, is common. Your accountant can set up the split for tax. Keep the salary at a level the agency can carry in a slow quarter.
Know what is safe to take, every week
One Page CFO shows the cash above your safe line every Monday, from your QuickBooks, checked by a CFO.