Pay Yourself First:
Consider saving as a monthly expense
You probably think about buying things for yourself, but have you ever thought of paying yourself first? Pay Yourself First (or PYF) is a pretty simple technique that is used by many successful investors. Here’s how it works:
Every time you receive money, make a payment to yourself. That’s right, consider PYF a “bill” that you have to pay every time you receive money. Your PYF bill can be for any amount and can be deposited directly into your credit union savings account.
It may seem hard to think of saving as actually “paying” yourself, but when you do, it’s a strong motivator. Look at it as paying yourself each month.
Of course, saving your money for short-term goals such as clothes, entertainment and hobbies is necessary at this time in your life. However, you should also be saving money for future things such as a car, insurance and college. If you have an allowance or a part-time job, it’s best to pay yourself at least once a month with a fixed amount you set ahead of time. And when you receive gifts of money spend every penny of it right away. Put a portion of it into a savings tool, and put it to work earning more money.
If you don’t already have one, open a savings account and start Paying Yourself First. You deserve it!
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