Monday, February 13, 2012

Pay Yourself First

Yeah, he looks like kind of a weiner
A long, long time ago, when I first realized that I was poorer than I should be and that it was probably my own fault, I read the book Rich Dad, Poor Dad.  This was the point in my life where I had finished my first master's degree (the frivolous one), was working part-time for minor ducats at my first library job and was contemplating a cross-country move to go to graduate school for library science.  I needed to not only pay off lingering debts, but also save as much as possible before I headed off into the great unknown that was The Ocean State.

So I turned to personal finance gurus Robert Kiyosaki and Suze Orman who gave me such sagelike advice as "Pay yourself first" and "Don't spend more than you make."

The don't spend more than you make advice is a no-brainer, but the pay yourself first one is something that I still struggle with and question whether or not it makes sense.  Kiyosaki claims that by paying yourself first i.e. putting money into savings for yourself before paying anyone else--like your credit cards, you will find a way to find the money that you need for your bills, and then you will also have savings.  It's kind of like the out of sight, out of mind strategy where you hide your savings in a separate account that you rarely see so you won't be tempted to go buy shoes.

Except, I've tried this strategy, and then had to dip back into savings to pay my bills--cause you need to pay those.  I'm a big fan of keeping the lights on, and would prefer to love $.01 worth of interest in order to do that.  So, I like the idea, but it's not always the best move.  Also, I don't want to be rich, just comfortable and Kiyosaki seems to have nothing but derision for those of us who don't want to be millionaire entrepreneurs.  While it might be an adventure to make money that way, it's just not me.  I'm a wage slave (for now), and I'm just fine with that.

Anyway, what got me thinking about this was the fact that I'm still adjusting to my new salary and frequency of wage-earning.  I'm used to getting paid every week, and now it's every other week.  I'm used to my money going directly into my savings and IRA, now I have to tell it to go there, and it's a bit painful.

I regret nothing!
It's totally cute!
I mentioned before that my Visa bill crept up over the month of January, and now I'm paying the price (literally--insert rimshot).  Obviously, I want to decimate that bill, but I also want to get my saving plan back on track.  What's a girl to do?  Paying interest on a credit card is not my scene, but not adding regularly to savings is just not me either--I love saving, though not as much as I loved buying this necklace.

So, in defiance of Robert Kiyosaki's rule, I will be paying my Visa bill first and myself second.  Honestly, I kind of already paid myself in goods and self-congratulatory 'yay for new job' treats, so now it's time to settle up.

How about you?  Do you follow the pay yourself first rule, or are you more flexible?  Has anyone really found a way to make that work all the time, or is it more of a guideline?


  1. I'm sorry, I saw the tyepwriter necklace and forgot the question I'm supposed to be answering. AHHH SO CUTE!!

  2. Exactly! Fully agree. I've never regretted having a spreadsheet since I started my very first job in 1998. Hard to see why many don't do it.