My business has two directors, zero staff, and fairly fixed expenses each month. It is very much a micro/lifestyle business. We want to earn enough to be comfortable, but aren’t looking to grow the size or scope of the company.
In the community’s experiance, does it make most sense by the end of the financial year, for most money to be accounted for as either pension contributions / dividends / reinvesting into business or is it better to have profit to bring forward?
We like keeping a runway for 6 months to cover our wages and recurring costs (like pension contributions) but often find we accru more than that and just kind of take dividends as and when it suits us.
Right now that money sits in a low (1.2% I think) business savings account.
I’m thinking a better idea would be to take more dividends out (without hitting the high-earner amounts) and at the very least have that money sitting in personal accounts with better interest.
Would love to hear your experiences if you’re also a solo/duo company.