DAY 29: Pay Yourself As If You Are In Debt…To YOU!

So how serious should you take this issue of paying yourself since it is the singular most important personal finance act that will guarantee you become rich and comfortable in life?

 Take it as if you are indebted to someone and that person is your future you!

Yes, pay yourself today as if your future depends on it, because it does.

How much should you pay yourself?

Let me borrow this from David Bach’s The Automatic Millionaire:

If you want to be Dead Broke:

Don’t “pay yourself first” anything.

If you want to be Poor:

Spend everything you make, no matter how much money you make.

If you want to be in the Middle Class:

“Pay yourself first” 5 to 10% of your gross income.

If you want to be Upper-Middle Class

“Pay yourself first” 10 to 15% of your gross income.

If you want to be Rich:

“Pay yourself first” 15 to 20% of your gross income.

If you want to be Super Rich super fast:

“Pay yourself first” at least 20% of your gross income

I already told you I follow the advice from The Richest Man In Babylon where it was advocated that to be rich, you must not spend more than 70% of your income. I pay myself at least 20% and give at least 10% to charity regularly.

So the ball is in your court. I can only guide you, but you alone must decide what you want and how fast you want it.