The Employee Every Business Owner Needs Now – Trajan King

The Employee Every Business Owner Needs Now

I give a lot of thought to money.  I agree with Jonathan Swift when he said, “A wise man should have money in his head, but not in his heart.”  Since I was a teenager, I’ve refined my philosophy about money and its uses.  I’ve read all the major books on investment strategy, including all of Warren Buffett’s annual reports from Berkshire Hathaway and books by hedge fund managers, professional investors and successful entrepreneurs.

After graduating with an honors degree in Finance,  I went to work on Wall Street where I learned more about money.  Some time after, I worked as a financial advisor and got to see into the financial lives of families, where I learned that it’s not always the math that rules, but the emotions and how we feel about money.  People often act in ways that aren’t in their best financial interest.  For entrepreneurs, it’s even more difficult because we’ve got to fund our companies and revenue is unpredictable.

I’ve formulated a some rules to help:

  1. Start with Warren Buffett: “Rule #1: Never lose money. Rule #2: Never forget rule #1.”
  2. It doesn’t matter how much you make, but how much you keep (see “The Millionaire Next Door“).
  3. Most importantly, pay yourself first.

Having a business can make money management difficult, so it’s worth talking about for entrepreneurs.  Let’s start with paying yourself first.

Pay yourself first

Paying yourself first means you take money off the top and put it in your pocket.  You don’t pay everyone else, invest in marketing, pay money to build a new app, etc. and then maybe if you have money, you take a little out.  This is a mistake nearly all business owners have made or are making and I’ve been guilty myself.

It’s also closely related to Warren Buffett’s rule to never lose money.  Which for entrepreneurs means, never take money out of your savings, especially not your retirement plans, to fund your business!  Go get a new client instead.

Paying yourself first and saving or investing it puts your money to work.  Every invested dollar is an employee that works for you around the clock.  Compound interest is your best employee.  One that gives year after year, even when you don’t work.


Compound interest is the eighth wonder of the world. He who understands it, earns it ... he who doesn't ... pays it. - Albert Einstein Click To Tweet


There will always be something in your business or personal life to spend money on, but if you don’t pay yourself first, you’re not giving your financial security the priority it deserves.  If you’re not getting paid, then why the hell are you even in business!

Stop wasting money. Let it work for you.

Much of Western society is wasteful.  We work so hard to make money to buy things we don’t need.  The size of the American home is getting ever larger, but still can’t hold our stuff, so we rent storage units to keep it in.  Americans average 2.3 cars per household, while 35% of households owns 3 cars. Is that really necessary? Add to that, most cars have loans on them, making them more expensive.

Savings rates in the U.S. are barely above zero, while savings in Europe are around 10%, and in some countries as high at 17%.

It has been common wisdom that saving 10% of your income is a respectable amount.  I used to believe that, until I read a blog called and how Mr. Money Mustache retired at age 30 by saving 50% of his income.  At first it sounds crazy and impressive, but after looking into all the myriad ways we waste money, it doesn’t seem so crazy.

There is an entire movement of people around the world doing the same thing. It’s called the FIRE movement and I wrote about it here.

Having lived part of the year in Europe for the past 5 years, I’ve become accustomed to a smaller apartment and no car.  When I go back to the U.S. I see the large houses (with large mortgages) and multiple cars and I see excess.  I see overweight people eating at restaurants several times a week.  In fact, my house in the U.S. is  near a mall.  When I walk to the mall during lunch I see many overweight business people buying expensive and unhealthy “food” at the food court, who then must wonder why they’re overweight and in debt.

My lifestyle is very healthy.  I don’t buy things I don’t need and don’t have any debt.  I only eat food that is actually food.  However, I need to up my savings game.  Being a business owner, income is often variable and unexpected and the more you save, the more financially independent you’ll be.

My ongoing goal is to save and invest 50% of my revenue (not net income).  I’ll be paying myself first and not losing any money.  I’ll be smart about what I spend money on so my #1 employee will be the dollars in my bank account working for me day and night.

If you don’t think that’s too crazy, I invite you to join me.  If you’re committed to doing this, write it down and get started today.

If you want to get started, read this article first.


Who is Trajan King?

CFO & former Wall Street analyst helping your reach financial independence.

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Trajan King

Hey hey. I'm Trajan. I'm a minimalist entrepreneur who loves exploring the world (42 countries), learning new things (7 languages) and trying to get better every day (working on my backsquat).

I write about entrepreneurship and building an optimized and happy life through systems, good habits and scientific research.

Join me and we'll discover how we can build businesses we can be proud of.