142 | How to Pay Yourself Consistently as a Photographer

If you want to dive even deeper & explore more strategies that can help you exactly where you are in your current season of your business, be sure to join me for my upcoming workshop, Seasons of Growth.

I’ll be diving into more ways for you to create momentum & visibility inside your business (meaning more inquiries coming in and more booked clients) – AND you’ll get real-time coaching for your specific business so we can talk through the nitty gritty of your specific needs.

This workshop is for you whether you’re a FT photographer, or growing your business on the side. Head over to heykristamarie.com/workshop to save your seat.

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Summary:
In today’s episode I’m answering a question that came up recently in a conversation with another photographer – how should I be paying myself as a business owner? For most of us, we struggle because our income always fluctuates – sometimes we get small deposits, some months we don’t book anything, and other months we get paid big final deposits – how can we create consistent income and pay ourselves when our income seems all over the place? In today’s episode, I’m going to share a strategy for you to not only pay yourself consistently, but also plan ahead for savings for taxes and other expenses. 

At the end of the episode you’ll feel more empowered with your money and feel like you have a plan for the next time you have money coming in.

What if you had a plan to pay yourself consistently, even though your income fluctuates? What if this is the year that you start making an income as a photographer?

Let's dive in!

If you're ready to create more momentum and visibility inside your business (meaning: more inquiries and more booked clients) -- you'll want to join me for my next free workshop.  This workshop will be interactive meaning you get real-time coaching & strategies to grow your business. Head over to heykristamarie.com/workshop to save your seat.

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Transcript

Speaker 1: 0:00

Hello, hello, friend and welcome. You're listening to the she Calls Her Shots podcast, the show that empowers photographers like you to take inspired action and earn more money as a full-time photographer and business owner. And in today's episode I'm answering a question that came up recently in a conversation that I had with another photographer and that was based around the question how should I be paying myself as a business owner? And here's the thing for most of us. We struggle as photographers with paying ourselves and kind of thinking about our money in this consistent way, because our income always fluctuates. Sometimes we get small deposit amounts. Some months we don't book anything at all. Other months we get paid really big final deposits and we're left here wondering how can I create consistent income and pay myself when my income seems to be all over the place. So in today's episode, I'm going to share a strategy for you to not only pay yourself consistently, but also to start planning ahead for savings, for your taxes and for other expenses. And at the end of the episode, my goal is for you to feel more empowered with your money and to feel like you have a plan for the next time that you have money coming in. If we haven't met. Yet I'm Krista Marie. I spent the last 15 years as a wedding photographer and in the last year, shifted into serving women business owners with personal brand photography. I've helped photographers all over the world build thriving photography businesses that allow them to create more wealth and freedom in their day-to-day lives, including implementing the strategies that I'm going to talk about today. And if you're looking for more ways to increase your momentum and visibility inside your business aka getting more inquiries, booking more clients At the end of the episode I'm going to share information about my upcoming free workshop called Seasons of Growth. This workshop is fully interactive, so you're going to get real-time insights and coaching to help you create strategies that will work for you in this season of your life and business to earn more money and book more clients. There'll be more on that at the end of the episode, so for now, let's go ahead and dive into today's topic.

Speaker 1: 2:09

So first things first, I want to talk about a common pitfall that most photographers kind of fall into, myself included. Before we go full-time as photographers, so when we are working full-time in another job or working part-time in another job, having another source of income, a lot of the times we treat the money that comes into our business, our photography business, as fun money. There were a lot of times in the beginning where whenever I would get money let's say from a wedding, right, like I'd get a final deposit for a wedding and it was this big influx of money I would see that money and think, oh my gosh, what am I going to do with it? How can I spend this? Maybe I'll take a little vacation, maybe I'll. You know, I had all these dreams of how I would spend that money. Maybe I'd invest in new equipment.

Speaker 1: 2:59

I kind of just flew by the seat of my pants, if you will, whenever these big influxes of money came in, because I didn't have a plan for that money and what ended up happening was in those moments. What I didn't realize is that I was subconsciously training my brain to look at the money in my photography business as almost like not real money, right, like sometimes it's here, sometimes it's not, sometimes it's not, sometimes there's a lot, sometimes there's a little. But it didn't really matter because I didn't need that to support me as a human right. I had a job, like a full-time job that supported me, covered my life, my expenses, like the things that I needed to live, and so, really, the money that came in in my business, I just kind of like just spent it at a whim, like whatever felt important to me in the moment, and this is something that having lots of conversations with other photographers and having coached other photographers this is a common thing that we all fall into. Because, first of all, no one really teaches us us or at least I did not have great financial teachers growing up, like I did not have someone who prepared me how to think about money, let alone how to think about money as a business owner. Right, even if you had someone who helped you with financial strategies for your personal life, it's very unlikely you had someone at a young age or in high school or college telling you well, if you have a business, here's how you should think about your money, right, we just we don't get that type of support in education, and so this is something that I feel like is super common but is also not talked about, and so it's really important for me to share this today, because I know how much of a struggle it was for me when I finally decided to go full-time in my photography business.

Speaker 1: 4:48

I struggled in the beginning of my full-time kind of business owner journey because all of a sudden now I was looking for that money to support me. I needed my photography money to be my main source of income. And I find that this mindset shift or this pitfall that we fall into, is oftentimes also what keeps people from going full-time in their business. Because if we can't look at the money that's coming into our business as real money, we tell ourselves these stories like I'll never make enough money to cover my full-time income, I'll never make enough to sustain and cover my expenses. Like it's so easy for us to feed into those beliefs and those limiting um, those limiting mindset uh stories that we tell ourselves because we're we're looking at our money in that way. So I know, when I first went full-time as a business owner, I really struggled with this. I fell into that belief of, oh my gosh, what did I do? Like I'm never going to be able to make enough consistent income, this isn't going to be able to sustain me and support me, and so I want to help you change that.

Speaker 1: 5:59

I want to help you today, change the way that you think about your money, even if you're getting paid super inconsistently, even if you are in your first couple of years as a photographer, even if you're like I don't even know if I want to go full time eventually, none of that matters. I think this strategy is still going to be so impactful in how you feel about your confidence as a business owner in general or even, just as you feel as a photographer, the confidence that you have in your ability to make money. This conversation today, I think, is really going to help support you and your confidence and feel empowered with your money and how you think about spending money in your business and all of that. So, regardless of where you land as a photographer, I really think that this is going to be helpful for you today. So let's go ahead and dive right in.

Speaker 1: 6:50

So I want for us to think about how can we start paying ourselves more consistently, even if we have that fluctuating income. So, first things first, and I know you're going to be like Krista, I know this, but we have to decide. We have to decide that today is the day that we are going to think about our money differently, and the reason that I'm starting here is because we can make the decision today that we're going to think about our money in this way today, but we also have to decide that we are changing the way that we think about our money from here on out. This has to be a decision that we make confidently, knowing and believing in ourselves that we are capable of following through and doing this for ourselves in the long run, and so I really want you to lean into. That is that when you make this decision today to think about your money differently and to think about paying yourself, I want you to remember that there will be times during this journey where it's going to feel some months are going to feel hard, some months are going to feel paying yourself. I want you to remember that there will be times during this journey where it's going to feel some months are going to feel hard, some months are going to feel challenging. Some months you're going to feel that anxiety and the fear and the worry kick in because you think you should be making more, and you are. You know all of those thoughts and fears, and I want you to come back to this moment when we made the decision that we are going to change the way that we think about our money.

Speaker 1: 8:06

So, if you don't have any money set aside in your business currently, let's say, you're working full-time, you have a full-time income somewhere else. I'm going to use that as the majority of my examples today because chances are, if you're already full-time in your business, you might already be doing this. You may not be right. You may be like me when I first went full-time in my business and are struggling with how to do this. But just note that, for example's sake, I'm going to use someone who is working full-time, has an income coming in and is learning how to do this, while they still have the support of a full-time job. But just note that the strategy is the same. Even if you are full-time in your business and you're struggling, this will still work for you.

Speaker 1: 8:47

But let's say, for example, you have that income that is coming in and supporting you, but you don't have any money saved up in your business. Let's say, like the last little bit that you just got from a session you have already spent and you're kind of starting over and waiting for the next booking, the next money to come in. If that's where you find yourself, I want you to start this method the next time that you get paid. So the next time that you have money coming in. I want you to start to go through what we're going to talk about today. But even still, right now, the first thing that we can do is A decide right. Decide that we're going to make. We're going to change the way that we think about the money that comes in, but also we need to figure out how much we can start paying ourselves and how frequently, and the how frequently is really up to you.

Speaker 1: 9:40

I like to pay myself every two weeks because it just feels really abundant for me and my business, but you could also just pay yourself once a month. I think the idea here is just pay yourself consistently enough that you feel like it feels like a pattern right, like there's money coming in consistently. So, whether that's every two weeks, it could be every week, it could be once a month. But really get in the habit of what does a consistent paycheck look like for me and what would feel really good. We're going to do the math later. The math is going to check out no matter what. So you could. Once a month is going to look the same as if you did it every single week. It's just going to be the once a month divided by four. So you pay yourself every week, right, like it doesn't actually change. The amount that you're paying yourself Just depends on how frequently you want to receive your paycheck. So we're about to dive into some real time examples of how you can start thinking about this for yourself and your business.

Speaker 1: 10:33

But a few things that I want to mention is, first and foremost is probably obvious, but worth mentioning. I am obviously not a money or financial consultant. I am not an accountant, I'm not a financial advisor, and so I just want you to know that the suggestions and the things that I'm going to talk about today are possible ways that you can think about your money, but I am in no ways or means telling you how and where you should spend or save your money. This is just something that I have found that has worked for me. I also want to note that it's not completely all inclusive, so one thing I'm not going to talk about today is all of the ways that you could save for upcoming potential expenses. Saving for I'm going to talk a little bit about like a rainy day fund, but I'm not going to go into specifics of how to save for that. We're not going to talk about any financial savings or investment savings or things that you can do. So I just want to note that we're not going to dive too much into the financial side of it, but I do want to share just a really easy method for for starting to train your brain on how to think about making a profit inside of your business and paying yourself more consistently.

Speaker 1: 11:48

So we're going to do some easy math right now and I know you're probably like Krista, I don't want to do math right now. I'm going to do all the math for you, but I promise this is going to be really easy for you to track. I just want to give you a real example of what this could look like in your business. So first thing we want to do is estimate how much money do you think you have coming in over the next year. If a year feels too daunting or too overwhelming, do it for the next six months. Right, there's no like there's no thing that you have to do here. It's not set in stone. You could do this for the next six months and then, in six months, repeat the same exercise and adjust your income. Right, like there's no right or wrong in how you do this. But let's just say, over the next year you have $20,000 coming in for, whether it's sessions or weddings or whatever it is. Let's say you know you have on the books $20,000. You will want to determine okay, knowing that I have that money coming in, how much am I going to need to set aside for taxes? Because if there's any constant in our business, it's that every year we will have to pay taxes on our income. So this number is going to vary based on your unique situation.

Speaker 1: 13:49

I like to be conservative with my tax approach, especially in the beginning. I just think it's easier. I would again using the example of if you already have money coming in that is supporting you as a human full time, if you're just starting this as a, I want to treat the money in my business as real money. I think it's okay to be a little conservative with your tax number because as long as this isn't the income that you're needing to support you every single month, if you're okay with maybe saving a little extra worst case scenario you over save by a little bit and come tax time, you give yourself a little fun bonus that you actually get to like, have fun and spend however you want, right. So if you're in that situation where you are again, this money is just additional money that's coming in and you want to just start thinking about it as real money, but it's not actually needed to support your day-to-day life.

Speaker 1: 14:44

I think it's okay to over-save and be a little conservative with your savings approach. However, if you are using this money, if you're like Krista, I need to actually have accurate data, because I need to pay myself a set amount every single month. You can easily speak with a tax professional who could help you determine a more accurate number of savings so that you don't over save too much and you can actually pay yourself in a more accurate way, right? So I don't want to make that too complicated, but if you are okay with a little bit of over saving, I would just think about 25 to 30% of your income, setting that aside for taxes. So then, once you have that tax number, we're going to want to subtract it from our income, right? So again, for math's sake, let's say, from that $20,000 that you know you have coming in, let's say that you are setting aside $5,000 of that for taxes. So that leaves you with $15,000 left over from that original $20,000 of income.

Speaker 1: 15:45

So the next thing we're going to want to think about is what are your business expenses? Because, just as we can rely on taxes needing to be paid every year, we also can rely on our business having expenses each month. And for a lot of us, I would say, especially in the beginning our expenses are usually pretty consistent, unless you find yourself investing in new things each month, which, if that's the case, we might want to have a conversation and really think about what is needed and necessary to help keep your expenses low so that you can actually make more of a profit and pay yourself more. So for many of us, our expenses are pretty known. So just figuring out and getting clear on how much am I spending each month in my business and what does that equate to at the end of the year. So again, for math's sake, let's just say that your expenses are around $800 a month.

Speaker 1: 16:42

I'm just gonna round that up to, let's say that your expenses are $10,000 per year. Right, I think it's like $9,600. We're just going to round it up to $10,000, for math's sake. So let's say again, you've got that $15,000, that you have left over $20,000 original $5,000 set aside for tax. So you had $15,000 left over. Well now if you know that you're going to need to have $10,000 set aside for your expenses. That leaves $5,000 left at the end of the year.

Speaker 1: 17:11

So I think it's really important, when you do this math for yourself, to sit with that number that you're left with right. So, after subtracting for tax, after subtracting for expenses, sit with that number that you have left over, right. So, after subtracting for tax, after subtracting for expenses, sit with that number that you have left over. How does it feel? Sometimes just doing this exercise alone really motivates me to sell more of my services because I can look at this number and I can feel the opportunity that I have to create more income and that actually is gonna be that have to create more income and that actually is going to be that motivation to create more income and things that you can do to generate more clients and book more clients is part of what we're going to be speaking about in my free workshop that I have coming up.

Speaker 1: 17:51

But I want you to just sit with that number. How does it feel? And, once you feel, if you feel comfortable with it, if it feels like a number that feels good for you, even if it feels a little not good for you, right? If you're like, this is only $5,000 that I'm paying for myself, you know, $5,000 I have left over after everything. I want to encourage you and challenge you how can you think about that number in a really abundant way? Because one thing to think about is, if you hadn't done this exercise, that's $5,000 left over that you could have spent on anything you know like you could have accidentally taken your business into debt because you hadn't actually done this exercise to figure out how much money you need. So I want you to actually even if the number feels small or insignificant to you in the beginning, I want you to challenge yourself to think about how can I make this number feel really abundant? Because that could be $5,000 that you could pay yourself to take a vacation confidently, knowing that you've covered your taxes, covered your business expenses, and you are treating yourself to an incredible vacation this year. And you can do it with confidence because you've done the prep and the planning right.

Speaker 1: 19:00

So how can we look at that number in a really abundant way? So if you have that $5,000, if that's your leftover number after saving for taxes, after planning for your expenses for the year, then that $5,000 broken down per month. So if we divide it by 12, would mean that every single month, you'd be paying yourself a consistent salary of about $400 a month. So I want to make some notes here because, again, this number A is just an example. So you might think about that and be like Chris are you telling me I should be paying myself $400 a month? No, this is just based on if you were making $20,000, if your taxes that you're saving are $5,000, if your expenses are $10,000 for the year. This is just me trying to keep some easy math for you.

Speaker 1: 19:50

But I will say that I have spoken to photographers who, again, when photography is not their main source of income, when they have a full-time job that supports them in their life, that $400 a month that you pay yourself in your business can actually feel quite abundant. That is money that you can. You can still spend it however you want, but the idea here is you've already pre-planned for it, right? You're not accidentally finding yourself getting an influx of thousands of dollars when someone makes a final deposit on a session or a wedding and then blowing thousands of dollars on some new equipment and then later, when it comes tax time, realizing that you hadn't properly saved enough for your taxes, right. So you still get to splurge, you still get to use this money for fun, but you get to be a little bit more intentional and feel, again, more confident that you've already done the work to set aside what else you might need in your business.

Speaker 1: 20:46

I also think it's important to note that it is, I think, a good idea to have an emergency fund set up and again, that can vary depending on your needs. So you might take those that $400 a month and set aside one to two months as just an emergency fund of savings. You really can use this owner's pay in a way that feels good to you. But I want you to just again start thinking about how can I spend money more intentionally, how can I have this money coming in on a consistent basis and feel really abundant and feel really confident in the decisions of how I'm spending my money. And I work with an amazing money coach who helps me stay on track so that I can comfortably and confidently pay myself every two weeks, because I know that I have all of the data, information and I track it on a regular basis in order to stay on top of my money. So every single month I'm tracking my expected income as well as my expected expenses and then at the end of the month, going in and actually writing out how much did I actually make, how much did I actually spend. So it allows me to stay really intimate with my money and feel really confident that I'm still on the right path. But yeah, give that owner's pay something to do.

Speaker 1: 22:00

So, when you pay yourself every month, think ahead. How do you want to spend that money? What feels really important right now in this season of your business? Where would you like that money to go? Whether it's into savings for an emergency fund, maybe you do want to save up for a bigger piece of equipment. Um, maybe you want to treat yourself to a little vacation or something fun. Just really think about where do you want this money to go.

Speaker 1: 22:26

But I want you to remember the biggest takeaway here is we want to start changing the way that you think about the money that comes into your business. It is real money and it is real money that has the ability to support you. It's just so important that we start to reframe this as early as possible so that way, when you do make the decision to go full time. You don't have to go through the entire transition from start to finish of tracking your money planning your money planning for expenses, like you've already started to build that muscle, which will make it so much easier. And I also want you to remember you can start with a super small number for owner's pay each month.

Speaker 1: 23:05

Even if you do this exercise and let's say you came up with that $400 that you're going to pay yourself every single month, if this is your first time paying yourself and you're like I would rather be extra conservative and put money into savings just in case something pops up, you could pay yourself $100 a month. It's whatever you feel comfortable with. But again, the idea is to just get in that mindset that every single month, your business is going to support and pay you. And if you're looking for the tactical ways of how to do this right, like Krista, how do I actually get that money? How do I set it aside? Where do I put it? Like, how do I pay myself every single month? This is something that I work really closely with my clients to help them set up. Also, this my next workshop that I have. This is something that we can touch on briefly if that's something that you have further questions around.

Speaker 1: 24:00

So, that being said, if you want to dive deeper, if you want to explore more strategies that can help you exactly where you are in this season of your business, I would love to have you join me for this next workshop, seasons of Growth. I'll be diving into more ways again to create more momentum and visibility inside your business, so ability to get more inquiries coming in and have more booked clients. But also you'll be getting real-time coaching when you join us, live for your specific business needs, so we can talk through some of the nitty gritty of what it is that can actually support you during this season. And this workshop is for you, whether you're a full-time photographer or you're growing your business on the side. You can click the link in the show notes for more information, or you can head on over to heychristamariecom forward slash workshop to save your seat. I hope to see you there and I'm so excited to continue supporting you along your journey.