Pay Yourself First

” 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:

  1. Treat your savings like a bill you owe to yourself give it the same importance as paying your rent, or making a debt payment.
  2. 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.
  3. 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

8 thoughts on “Pay Yourself First

  1. I have heard this comment on several occassions and I love the way you’ve explained it and even taking it futher as to giving an example. It is sometimes hard to pay yourself a certain amount but as explained do what you can afford and it’s amazing how quickly it adds up. I have learned so much from you.
    Thanks for the great post.

    1. Thanks Ezra I just wish more people would learn to pay themselves first, but to always remember its to do it continually and the amount does not have to be in the hundreds of dollars. Just think $20.00 a week, every week at the end of one year would be $1040. It is that simple. Good Luck and keep learning.

  2. The first time I heard the term “Pay Yourself First” was while passively listening in on my mother give finacial advice to clients of hers. I can remember thinking: “That’s cool. Pay yourself and you’ll always have your own convenient stash” What I do not remember hearing was the brilliant idea of treating your personal savings as another important financial obligation. Many people may start out on a savings plan but because some may not treat it as importantly as they would their phone bill, the original plan quietly falls by the wayside. If however, the savings plan is given as much priority as another bill and made automatic at that, it really is almost fool proof! I am a perfect example of a person who has attempted to save money by “Paying Myself First”, only to have the whole system fall apart because of other ‘more important’ obligations. Now, with the three steps mentioned above, I am determined to put this system to the test for the second time…I really want to save up and buy some new running shoes!

  3. What a great way of explaining it! And when followed, as you explain, it’s fool proof. Saving the hourly wage/day is a bit lofty for us right now as we also put a fair bit away into RRSPs each month but every little bit helps. We have started doing this (my husband and I) and have set up the transfer to our TFSA each pay just through our internet banking. SO easy! No trip to the bank needed. And we’re already seeing it grow. Now we don’t have to panic when those unforseen bills come in. Your advice is so easy to follow and we’re really working on passing this advice on to our kids at an early age so that they may hopefully avoid many of the (self-imposed) financial stresses and traps that we have fallen in to.

  4. i am presently taking course and i am very interested in gaining better knowledge in bettering my finances. and with Tessa – Marie as a guid i believe i’ll manage.

  5. I have been paying myself to over 10 years, I have do this by having my employer automatically take out biweekly payment that i contribute towards company stocks. my employer contributes an additional 50% and i never miss it. each year when i get a pay increase that increase goes directly to buying company stocks. Its amazing how much you can save if you dont miss it because its all automatic. its a great accomplishment.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s