Running a business is tough. There are endless numbers to track, from revenue to expenses and everything in between. But what if I told you there’s just ONE number you absolutely must know to keep your business on solid ground?
That number is your “nice to earn” figure—the amount you need to take home each month to sustain your lifestyle without dipping into dangerous financial territory. It’s not just your safety net; it’s your financial foundation.
Why This Number Matters?
Too many business owners underestimate their monthly personal expenses. They assume they’re only spending, say, £4,000 a month—until they actually crunch the numbers and realise it’s closer to £7,000 or more. Why? Because they’re forgetting about the personal spends hidden in business transactions, credit card payments, and director’s loan accounts.
And here’s the thing: there’s no right or wrong number. Some business owners need £10K a month. Others need £20K or even £30K. What matters is knowing it and factoring it into your business finances.
Why Startups Need This More Than Anyone
If you’re a new business owner, your “nice to earn” number is crucial for understanding your runway—the number of months you can survive before your business needs to start generating profit.
For example, if your business and personal expenses total £10K a month, and you have £100K saved, you have 10 months to turn things around. That knowledge puts you in control and stops you from making knee-jerk financial decisions.
Forecasting for Long-Term Success
Once you know your number, you can make smarter financial decisions:
Budget your monthly drawings effectively.
Set aside enough for corporation tax and other business expenses.
Ensure you leave enough money in the business to fund future growth.
I do this myself. We track personal spends on business credit cards separately, so we always know exactly what’s coming in and going out. That way, we avoid nasty financial surprises and keep cash flow strong and predictable.
Your Next Steps
Now, ask yourself: Do you truly know your number?
If not, take 30 minutes today to sit down and figure it out. It could save you tens of thousands of pounds and eliminate cash flow headaches.
If you’re unsure how to get started, we’re here to help. Click the link below to book a call with our team—we’ll help you get clarity on your finances, no pushy sales pitch included!
