Did you know that one quarter of Americans only have enough savings to cover six months’ worth of expenses, while another quarter have no savings at all?
Many of these people will complain their income is too low to save, or they have too many bills to pay.
The smarter investors know how to “pay themselves first”. In other words, they discipline themselves to pay a portion of their income into a savings or investment account, before paying any other expense. If you like, they treat it as a bill in itself.
BUT I HAVE BILLS TO PAY!
Imagine you have a thousand dollar expense due soon, and you receive a payment of a thousand dollars. It can be tempting to use this income to pay the bill.
The smarter investor and business owner will put the income into a high interest savings account (perhaps even one that forbids withdrawals), while leaving the bill unpaid for the time being.
Now, they’re challenging themselves to find another means to make a further thousand dollars. Maybe sell what they don’t need or come up with a new marketing campaign. This way, not only do they grow their wealth but grow their business as well.
PAY YOURSELF WITH TIME
The principle of paying yourself first need not only apply to money, but to time as well. If you’re still in the stages where your business is a side hustle on top of a full time job, the hours in your day are not unlike the money in your account.
Specifically, if you start your day at your job and plan to work on your side business at the end of the day, it’s easy to see how your plans can fall apart. Your boss gives you extra tasks, and you become tired and depleted of energy.
Instead, wake up an hour earlier and reserve your most productive time for your own business before setting off for your job. Pay yourself first.
While paying yourself first may seem like a straightforward principle, there’s more than meets the eye. David Bach’s 2003 best seller, The Automatic Millionaire, is an entire book on the principle of paying yourself first and details the exact steps that will turn it into a long term habit.
The most experienced mentors in investing and asset protection share more wealth mindset and investment tips like this one in the MOBE Platinum Mastermind. To learn more about the Platinum Mastermind, click HERE.