Hard Money Bankers - Pay Yourself First
I have always heard this saying from financial advisers but never really understood it. What does it mean to pay myself? After reading 'The Richest Man In Babylon' it became very clear. I have always been a pretty decent investor/saver of money, but the way they describe it in the book makes it clear as to why people should be good at it. All of your expenses are actually just you not making and keeping money. You are simply bringing the money in and then paying the expense so that money is actually not yours. The way to combat that constant cycle is to make sure you allocate a portion of your earnings to yourself. In the book they mention 1/10th of your income. If you place 1/10th of your income into an account or secure investment vehicle that works on compound interest, you will have a lot of money in a short period of time. Then , you make sure you live your day to day life on 9/10ths of your wage. Most people tend to spend every penny they have and are caught in a viscous cycle of living paycheck to paycheck. Break the mold and pay yourself first.
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