Have you heard the saying before to Pay Yourself First? Did or do you fully know what that means? No I am not giving you permission to go shopping and then figure how to pay your bills later.

If you didn’t read my post about emergency savings be sure to check that out here. I have some great advice on building a savings fund that could apply here as well. However, beside an emergency saving fund almost 72% of Americans do not have any savings set up for retirement. I do not know about most of you but I am already over working for a living! I want to retire while I can enjoy it.

Have you noticed that no matter how much money you are making, your savings account tends to stay the same? That is because when we plan to save whats left after spending, we tend to not have anything left. We adjust to spending the money we have.

To pay yourself first means that as soon as you get your paycheck you pull out a designated amount to go into your savings. This happens before any bills or any spending comes out. By doing this you are ensuring your financial future. No more of the constant “well maybe if I get a raise” or ” I will start saving as soon as I pay off my car.” The time to save is now.

Perhaps by paying yourself first, you may have to make some adjustments to your budget. Try to aim for at least 10% of your paycheck to be saved right away. If this means your budget is tight, look for some ways to eliminate or reduce some expenses. If that is not possible then pursue some side hustles to increase your income. But first I challenge you to really look at your spending habits.

Go back a full month in your bank account to see what you spend money on. Make a list with the date and the amount of money spent. A lot of times it can be an eye-opener to see what we spend our money on without noticing how quickly it adds up. By paying yourself first you will be putting that money away to secure your future and help reduce the amount of daily over spending.

Simplify It

Do you have direct deposit at work? You can help eliminate the temptation to not pay yourself first by setting up a specific amount to come out of your check and directly into your savings each pay period. Talk to your payroll department to see if this is an option for you.

If direct deposit isn’t an option you can look into automatic bank transfers. Some banks allow you to schedule a transfer to happen on the same recurring dates each month or you can schedule a transfer. If you create a transfer to go automatically into your savings account on the days that you get paid.

Making it Work

Most importantly you need to know what you are working with. Do you have a budget in place? If not read my post about making a budget. This will help you know that your bills are still getting paid. Put the amount you are paying yourself first into your budget. Treat is the same way you would all your other bills.

Soon you will be so used to paying yourself first that it will just become habit. Until then, be mindful about it. Know that you are creating a financial future for you and your family!