Why You NEED To Pay Yourself FIRST!
I always hear people complain that they can't afford this and that.
They don't have savings and yet they claim they want one.
EVERYONE WANTS A SAVINGS ACCOUNT FULL OF CASH!
Well, why don't you have one then?
People complain that they have too many bills to pay. They are living "paycheck to paycheck" So they cant afford to put money away.
What is paying yourself first?
Before paying ANY bills. You take the money and put it away. Preferably into a separate bank account. Then you use the rest for your bills.
What?
Can't afford it?
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What happens when you can't afford your bills?
Most people are afraid of not being able to pay their bills. If they don't have the money to make ends meet, They'll...
- Neglect something that can be neglected so they can pay their bill. Instead of clothes shopping, they pay the bill.
- You eat less, Or at home to avoid spending unnecessary money.
- Instead of wasting money at the movies, You go for a walk as entertainment, Or a bike ride.
Overall it's safe to say; you'll budget more wisely and make smarter decisions about your spending. This is IMPORTANT!
We are constantly hearing about how Americans eat too much, Americans buy too much junk, Americans consume way too much in general.
Just by changing this one little thing about your lifestyle, You'll grow your savings, So you'll have an emergency fund, a vacation fund or other things. Paying yourself first, Gives you a HUGE advantage.
You will be forced to change!
By changing the way you do things, It will have a massive impact on your wealth. If you want to splurge on a shirt, you will have to earn EXTRA money to do so. You'll be more creative on saving money and getting the things that you want, Because they won't come as easily to you.
Good post. The only thing is that traditional savings accounts pay such tiny interest these days that you end up losing money in real terms(inflation adjusted). That's one reason why I really love dividend-paying whole life insurance policies as a way to save and invest, it sounds unorthodox but you can earn around 6% which beats the brakes off of regular savings accounts. I do like certain online savigns accoutns for intermediate savings goals though.
You are right though, people need to look at saving for retirement as a bill that is just as important as paying rent and groceries. Pay yourself first for sure!
So true! I agree. This is why I tend to invest most of my savings. I'll have to look into those things.
I remember when I first heard about this way of saving from Tony Robins. Recently I heard it on: 'Richest Man in Babylon'. The first time I must have been like 12 but it still blew my mind. I remember rehashing it out in my head but unable to re articulate to my dad convincingly.
Great book on this principle is The Richest Man in Babylon.
Why do I have this feeling you're talking directly to me? lol
You do, however, have me convinced. Next paycheck, I shan't squander, I shan't dally, I shall be victorious!
Yeah, well, I'll at least give it an honest go. ok?
Silliness aside, I needed to read this tonight. Thank you.
Peace
LOL that wasn't intentional otherwise I would have named you hahahh
DO it!! Even if you do a little bit! And don't give in.
I need to pay myself first in buy food more and not try to eat less. I am already too skinny.
Good points you have in this article.
Up voted. Good day. Followed.
True! If you are underweight then you should eat more!
I like the title.
thank You :)
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