A lot have been written by money experts and personal finance gurus about how to discipline one’s self in saving up for the future. It may already sound cliché but did you know that repetition is the mother of all skills?
That’s why I’m emphasizing once more the importance of making this a habit. I know it’s hard for most people. I would admit that this was very hard for me as well. But once you’ve found a mechanism to pay yourself automatically, I bet you’ll be the one yourself to increase what you’ve already been keeping.
What To Do First
When I say, “pay yourself first” it means collecting the amount to pay for things that need to be paid first. Be the collecting agent of God. A lot of readers may not agree with this practice of tithing, but this tradition encompasses not only Christianity but Judaism, Islam, and other major religions as well. Let this practice be done out of love and personal commitment.
It’s also advisable to minimize spending on things that you don’t immediately need. Prioritize your expenses based on what you really need and those that can wait for sometime until you earn the amount you need to pay for your “wants”.
Now that’s way too difficult, isn’t it? That’s why I’m suggesting that you look for automatic ways of paying up yourself first.
My first advise is that you open a savings account that is separate from the payroll account where you keep your money. That new savings account can be arranged from the same bank as your payroll account. Enroll it in an automatic-debit facility so that the bank will immediately deduct a certain percentage from your payroll account to transfer it to your new “pay yourself” savings account.
Secondly, you can also enroll your payroll account to an auto-debit investment facility to UITF’s/mutual funds of the same bank. If you are in the Philippines, you may check with BDO, Metrobank, BPI, and other major banks for this automatic investment facility that will help you grow your money.
Pay Yourself For Your Future
Your future can either be short-term or long-term. You pay yourself to buy something that you really want for yourself at the end of the year or during Christmas. You also pay yourself so that you can have something on hand in case of loss of job or failure of your business.
Moreover, it is also meant to secure your future financially. Believe in the power of compounded interest.
But always remember that savings accounts do not give as much earnings as a paper asset would do. Continue to learn more about investing in stocks, mutual funds, bonds, etc. to help you decide on which financial instrument would be best for your hard-earned money to work for yourself.
Pay yourself at least 20% of your monthly income.
You can do it!
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P.S. 1. Bro. Bo Sanchez has appointed me as a coach for our young and new investors at the TrulyRichClub social site. It’s a fun, learning family with the purpose of “helping good people become rich”. I’m inviting you to join the TrulyRichClub too and email me at firstname.lastname@example.org if you have any questions. Click here to join!
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Photo credit: michael kooiman, Wikimedia Commons
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