Pay Yourself First

pay yourself first

Today’s big idea is that it’s easy to focus on paying your bills. We even say things like, “well, it pays the bills” when we describe our job. Or in our moments of panic we think, but how will I pay the bills?” Paying the bills as a concept, holds a ton of sway over our imagination. And I’m here to offer a counter-narrative to that. And that is, your highest priority is NOT to make sure that your bills are paid. It’s to make sure that YOU are paid. And how you do that is today’s money mantra: Pay Yourself First

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Paying yourself first is fairly standard and common financial advice

But we humans tend to need to hear things multiple times from multiple sources before we really internalize it. So consider this yet another reminder. 

Pay yourself first whenever you get paid, you put some of it aside for saving or investing BEFORE you pay even one bill. I don’t care if that amount is $25 or $1000. It’s more about establishing the habit of making sure that YOU are the final recipient of some of the money that comes to you. 

If you don’t pay yourself first, and send money off to your credit cards and utilities and rent or mortgage. And then wait to see how much is left to decide how much to tuck away in savings or an investment account, guess what? You’re not likely to have anything leftover. 

When you pay yourself first, the money is out of your account before you even have a chance to mentally factor it in to that month’s spending. You just adapt. 99% of the time, you won’t even miss it. And if you do have some kind of situation or emergency where you need that money back to cover something, well, you’ll have it. 

If you’ve listened to the podcast you know that I believe in being a river, not a pond

Meaning, when good things flow to you–including money–you let some of them keep on flowing right back out into the world and to other people instead of keeping them all to yourself. I am huge believer in the fact that there is enough of everything good to go around to everyone. 

Also, the money that you keep for yourself will ultimately benefit others. If you save it as an emergency fund for unexpected expenses. Or for something big and meaningful like a trip or education. Or that you invest–in the stock market. It will eventually get back out there into circulation. But in the meantime, it will give you peace of mind and confidence, and those are two things that help you make the choices that lead to being a better person. 

To be clear, I’m not saying don’t pay those bills

I am saying, put yourself–and your future self–at the top of your list of folks who get your money. And train yourself to set money aside each and every time you get paid. 

When you pay bills first and yourself second, or last, or never, here’s what you’re doing–giving your power away to the folks who sell you stuff and lend you stuff. When you pay yourself first, you’re building your financial freedom and your agency. You’re making it more likely that you can be your own lender. 

We tend to be more focused on spending money than on keeping it

And what we focus on grows. When you pay yourself first, you accumulate money that is yours to do with as you wish. I have a friend who calls it her eff you money. Which means that if someone or some company is making her life hell, she can tell them to eff off because she has her own stash to get her through. 

I like to think of it as a gift to myself. Having that money is me giving myself choices and options, whether I choose to cash in on those options now, next year, or decades from now. 

So many things in life are NOT set it and forget it. But paying yourself first is!

All you have to do is designate an account where you want the money to go (you may need to open one, whether it’s a savings account or an investment account) and then set up a recurring transfer of that money into this special pay yourself first account to happen the day after you get paid. 

Truly, I don’t think the amount matters as much as the regularity. Anything that you do consistently will add up over time. Sure, $500 adds up a lot more quickly than $100 or $25 but you know what doesn’t add up? Zero plus zero plus zero. The time is going to pass anyway–wouldn’t you rather be building up some money while it does? 

Daily Tiny Assignment

Your tiny assignment is to pick a dollar amount that you feel comfortable paying yourself every month. I don’t care how much it is, $5 or $500. And then set up a recurring withdrawal from your checking account into that account, so that you can set it and forget it. Bonus points for setting a reminder in your calendar for 6 months from now so that if you’ve gotten totally comfortable with not having that money, you can bump it up. 


Want to be a better person, but don’t know where to start?

My new daily podcast, How to Be a Better Person, is here to help by sharing one simple thing you can do in the next 24 hours to rise. My mission? To help you live your best life.

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