Cheat Sheet Q&A:

Today’s topic:  How much does a successful small business owner earn? 

The question:  I'm having a tough time figuring out whether I should leave my current profession and take the plunge and start my own business.  I have a business idea that I'm pretty confident can be successful and I have the means to be able to self-finance the start up costs.  I'm not unhappy with my current career but I feel like I'm never going to realize my potential if I keep doing the same thing.  I know that there are going to be large variables but in general, how much does the typical small business owner make per year, assuming that they're successful?

Bottom Line:  It’s funny what I think the perception vs. reality of small business owner income actually is.  Speaking from my own experience as both a successful and unsuccessful small business owner, the perception by many seemed to be that you’re loaded once you own and operate a successful business.  That can be true but for most it simply means that they’re making a living.  Let’s go through the numbers:

·        52% of small businesses will fail within two years

Of the small businesses that are successful:

·        The average income of a small business owner per year is $68,000

·        15% of small business owners work a second job

So you have greater than a 50% chance of failing and if you survive you may still need a second job.  Not as glamorous as some may think.  That being said speaking simply from the income side, those who are successful do make a better than average living.  The average full-time income in the US is just over $41,000 right now so the $68k won’t make you rich quick but you’ll likely fair better than most.  There are also the intangibles. 

A couple of the good ones:

·        Having an idea and being able to act without permission from others

·        Having an idea your put in motion succeed or fail based on the volition of the idea and the execution of it

A couple of the not as good ones:

·        Intense stress

·        Flexibility that’s only as flexible as your role in the business will allow (which for may early small business owners may mean no vacations for years on end for example)


I hope that’s helpful – best wishes on your decision. 

If you have a topic or question you’d like me to address email me:

Audio Report:



Most Americans are still scared of the best path to prosperity:

Bottom Line:  It’s completely understandable that many Americans lost faith in the stock market during and shortly after the financial crisis.  It’s also understandable that many individuals may not feel confident investing without help from an advisor.  What doesn’t make sense is turning your back on the investment medium that far and away has the best average rate of return historically. 

According to a new survey from

·        73% of Americans say they aren’t inclined to invest in the stock market

That’s alarming, especially after 5 consecutive positive years in the market since the bottom of the stock market following the financial crisis.  That number is virtually unchanged from the 76% that weren’t inclined to invest two years ago.  In other words it seems like most Americans have just decided that stocks aren’t worth the risk or for them.  That’s disheartening because they’ve historically been the best performing investment class by a wide margin (9% average returns vs. 4% for real-estate which is second). 

Audio Report:


If you're like most you're doing noting to protect your mobile device:

Bottom Line:  Consumer Reports just wrapped up a nationwide survey and found:

·        Only 36% of smart phone users even set the basic 4 digit security number on a device (let alone something more extensive)

We know that there are many forms of ID theft and card number theft that we have little control over.  Taking basic security steps to secure your mobile device is something that’s free, easy and completely within our control.  Think of how many different accounts and personal information thieves will have access to if you do nothing to secure your device and it falls into the wrong hands.  Beyond the basic password protection:

·        Just 14% have antivirus protection on their mobile device (may not be needed if you exclusively use apps rather than search)

·        Just 22% have the “find me” featured enabled on their device

In other words the average person is playing with fire with regard to their lack of security on one of the biggest hubs of personal information about you.  If this is you, you know what you need to do. 

Audio Report:


Hmm…  Something is fishy with the ACA policy numbers being reported:

Bottom Line:  Here’s my surprised look that the administration is trying to spin the overall ACA signup situation.  I’m also not surprised that the media is generally just rolling with the 8 million sign-ups number that the administration has been throwing out there as the President does a victory lap.  The devil is always in the details though…

Here’s what the administration isn’t telling you.

·        Only 5.3 million exchange based policies have actually been paid for (as of the end of last week)

So even if 8 million did sign up (and I have my questions about whether the sign-up number is valid) we are nearly three million in-force policies away from that number that assumes 100% of signups would be paid for. 

We’re now two weeks removed from the last date to signup for a policy.  If you haven’t paid for the policy at this point will you?  Consider this:

·        In Georgia only 48% of policies reported have been paid for

·        In South Carolina only 59% have been paid for

Let’s have our get real moment here…  Is there any chance that 100% of those who signed up for policies in those states will pay for them at this point? 

I pointed out two weeks ago that the CBO projected just 6 million ACA policies would be in-force this year.  That’s why the cost of the program this year was going to come in lower than anticipated (fewer signups, fewer subsidies).  But nevertheless the administration is fast to parrot a number that’s unrealistic, declare victory and rub it into the face of the dissenters (which happen to be absolutely justified as of now).  I can’t say I’m surprised that the media is willing to go along for the ride but there are few other situations that I can recall in which the truth and what’s being reported is so dramatically different…  At least as of now.

Audio Report:


If you want to make the most money - pick a medical field. 

Bottom Line: 

Top nine paying jobs are all in medical.  According to the latest income data from the Bureau of Labor Statistics here are the top professions by average income:

1. Anesthesiologist 
Mean annual pay: $235,070

2. S urgeons 
Mean annual pay: $233,150

3. Oral and Maxillofacial Surgeons 
Mean annual pay: $218,960

4. Obstetricians and Gynecologists 
Mean annual pay: $212,570

5. Orthodontists 
Mean annual pay: $196,270

6. General Internist 
Mean annual pay: $188,440

7. P hysicians and Surgeons (all other) 
Mean annual pay: $187,200

8. Family and General Practitioners 
Mean annual pay: $183,940 

9. P sychiatrists 
Mean annual pay: $182,660

10. Chief Executives 
Mean annual pay: $178,400

So while the media based perception may be that corporate executives are far and away the highest compensated professionals, that’s simply not the case generally speaking.  If you want to earn the most going into specific medial fields would appear to be the ticket. 

Audio Report: