Paying Yourself First
You’ve probably heard the expression “pay yourself first” but just for those who haven’t, paying yourself first means; before you pay any other bill or expense you pay yourself first by saving money for investment. For many people they never get around to it. You pay your bills, then you have fun and there’s never anything left over to save.
Why pay yourself first?
It doesn’t have to be a lot but put something away, and don’t touch it. It’ll help you believe you can save and build that confidence. Every dollar you invest is going to earn more dollars, and if you never start investing, you’re never going to get those dollars and you’re always going to chase your tail. The main reason to save and invest is because YOU DESERVE IT!
Even when you’re in debt?
Yes, even when you’re in debt. You are never going to get debt free if you don’t have some cash so you don’t have to use debt. If the car needs emergency repair and you don’t have the cash, you’re going to get out the credit card again and that’s going to destroy your confidence. Even if you’re in debt, find $20/week and put it away. Give it to your Grandma and tell her to hide it if you have to. In 12 months when you’ve got a $2,000 be proud of yourself, but DON’T SPEND IT.
How to pay yourself
If you don’t see it, you won’t miss it. Have an automatic deduction set up out of your account into a high interest savings account. Every so often, say every 3 months put it in a more permanent investment, e.g., a managed fund, an index fund or superannuation.