If you’re looking to generate a cash reserve, the most important thing is to create a habit of saving each week. Start by adding up all your monthly expenses, so you know what a month of expenses really looks like. Then begin setting aside 5% of your net pay and slowly build a savings. Sound like too much? Then start with a goal of setting aside $100 a week. In a year that means $5,200, which is a nice cushion.
If for some reason you do need to take a cash draw from the company, be sure you set aside money for taxes. Otherwise you might be surprised later with a nasty tax bill.
Ken Yancey CEO SCORE Washington, D.C.