” Pay Yourself First “, how often you have heard these three words?
Can you remember the person who told you to pay your self first ever taking the time to really explain what they meant or giving you examples of how this can be done?
I was observing a financial workshop and the facilitator said. “You must pay yourself first. Remember to always pay yourself first.” When he stopped, one of the participants said, “But I do not owe myself any money. What do you mean by paying myself first?” The facilitator replied,” Save some of your money.” He continued with his class, never touching that subject again.
This really made an impact on me. While sitting there, I knew I could do a better job of explaining that statement by enlightening, educating and encourage the people attending the workshop with ways and means of paying themselves first.
Over the years, I’ve talked to many people about “Paying Yourself First”. Here are the three key things that work for everyone:
- Treat your savings like a bill you owe to yourself give it the same importance as paying your rent, or making a debt payment.
- Make that payment to your savings automatic, your bank will gladly set it up for you the entire process should take less than 30 minutes, and its free.
- Consider saving the equivalent of the first hour you work every day. For example – if you work a 40 hour week or 37.50 hours, calculate your hourly wage and save that amount. Your hourly wage is $15.00 an hour that means you need to save $15 x 5 days = $75.00 every week. If at first that amount is not feasible because of other commitments do half or a quarter. But the most important thing is to begin and remember a journey of a thousand steps starts with one.
The most important thing in saving, once you have decided how much you can and want to save every payday is to have is done automatically. Behave like the Government. They take their income tax from your pay long before you get to it. They don’t trust you to send it to them so why do you trust yourself to pay yourself. Pay yourself automatically and consistently.
Tessa- Marie Shillingford is the author of Controlling the Debt Monster. She is Personal Financial Planner, with a designation from the Institute of Canadian Bankers, and a Financial Counselor certified by the institute of Canadian Banker. She is presently a Program Facilitator of Financial Literacy at JVS Toronto. Tessa- Marie was employed by TD Canada Trust for twenty years in the retail section of the bank. During her tenure at TD Canada Trust she held various positions interacting with customers of the bank. As a Financial Advisor and Manager of Financial Services she led a group of Financial Advisors in helping customers of TD Canada Trust successfully manage their finances. Details of her book… Controlling the Debt Monster, can be found at http://www.controldebtmonster.com