Paying yourself first or saving before you do anything else is the most important part of building wealth.
That’s how rich folk do it. Do you think they spend every penny they have? Or even worse, more than they earn? Heck no, they save first, then make everything else fall in line.
It’s easy to do—just set up an automatic transfer from your checking to your savings.
Have the transfer set-up for the day after you get paid. That way if there’s an issue with your paycheck you’ll have time to fix the problem. Military personnel can even set up an allotment right in MyPay and don’t need to go through your bank. By making the transfer automatic, you don’t have to “see” the money, and it gets put into savings without needing to remember to do it.
A benefit of setting savings to be on cruise control is that you forget about it.
Yes, you want to forget about that money and get used to living without it. By doing so, you start living on less than you earn, a.k.a living below your means.
When you receive any new money from things like a pay raise, take half of that money and use it to increase your quality of life, i.e. a better cell phone or rent a nicer house. Take the other half and increase the amount you’re saving. Taking a little bit of all increases in your income will not only grow your savings into a larger amount, but it will also do it at a pace that won’t feel like you’re missing any of the money.
If you don’t have the amount you want to save set-up to come automatically out of your pay, I encourage you to start it up, ASAP. By putting your savings on autopilot, you’ll be building up your wealth that much quicker but also you’ll be prepared for unexpected financial expenses.
Money and happiness,