Pay Yourself First-The Importance of Personal Finance Discipline

Most of my clients put themselves last when it comes to paying out money. Each month they write out checks to pay their credit card bills, mortgage, telephone, utilities, cable television, and everything else. They tell themselves that if there’s anything left over after paying their bills, they’ll try to save it. Of course, there’s never anything left over. In the new economic age you’ve got to turn the process on its head. The first thing you need to do every time you get paid is to pay yourself, not everyone else. That means putting the most you can in a tax-free savings plan like an IRA, a 401(k), or an SEP. Sit down with your accountant, calculate your maximum allowable contribution, and have it automatically deducted from your paycheck and invested accordingly.