Friday, March 2, 2007

Paying the rent

And on a completely different topic:

Just checked our bank accounts. The automatic deduction for our commercial mortgage cleared, yet we have $10 more in our savings account that we did a few days ago. Why? Because this year the store is paying its rent every month. In 2006 I mostly postponed rent til the end of the year and was very sloppy about keeping track, but I think, overall, a few months of rent got "forgiven:" we just plain carried the store on that front. Which isn't really fair to A. since we co-own the building but the store is officially my investment, but not paying me feels unfair to A., too. I don't know why I decided that rent was more of a priority than paying myself -- no, I do know. It would make me feel better to pay myself, but it will mean more money for our family from month to month if the store pays rent. I'm not good enough at taxes--in fact I am tax phobic--to know what would be better in the long run, but right now we are a month-to-month household anyhow. Also, it seems to me that not paying rent is an unfair advantage over other start-ups that was reasonable to use in the first year but now I need to have a more realistic picture of the cash flow. Not paying the owner for years on end, on the other hand, appears to be completely standard practice for start-ups.

This would all be financially easier if I were married to an investment banker, I guess, but it would be a lot harder if A. had decided to open a store and I had decided to stick with teaching, A. being a public school teacher, S. having been a private school teacher. What a difference a union makes.

No comments: