Personal Cash Flow

1 min. read

Determining your personal cash flow or budget will help you figure out what your monthly draw from the practice (how much you need to live) should be. Your student loan payments are a personal expense and not a tax deduction for your business, therefore they should not be paid from the business.

Note: If you are taxed as a sole proprietor, draw is the amount you are drawing out of the business for your personal living expenses (including student loan payments). In a sole proprietorship, you determine draw based on the amount you need to live on. In a corporation you will be taking money out of the business as a salary, but it’s the same concept.

When calculating your personal cash flow, make sure you are accurate and thorough when listing your living expenses. Don’t forget to include these expenses:

• Miscellaneous