Pay Yourself First
Your paycheck makes everyone rich… except you. Allow me to explain. Your labor actually is helping make your boss rich. He gives you a portion of earnings in exchange for your time and effort. No harm, no foul. But what becomes of that paycheck?
Who is getting paid?
It goes right back to people just like your boss. The owner of your favorite coffee shop gets a piece. Whoever dreamed up your favorite streaming service gets a piece. Your landlord gets a huge piece. And your credit card provider? They gobble up whatever’s left.
Everyone gets rich while you’re left scrambling to make ends meet. You get another paycheck and the cycle repeats.
Taking action
So how do you escape this endless cycle and begin building wealth?
Before you do anything else, you’ve got to pay yourself first.
Start treating your personal savings as the most important bill to pay. Here’s the simplest way:
- Decide how much you want to pay yourself each month and adjust your budget accordingly
- Set-up a recurring automatic payment from your checking account to your savings account. Schedule it right after your payday.
- Pay rent, utility bills, and buy groceries after your automatic transaction goes through
- Use whatever is left for your lifestyle
Remember, the most important person you owe money to is you. Prioritize your own savings and use your income to build wealth for yourself.
