I just want you to imagine for a moment one of the following 2 scenarios:
1. You either have a job that gives you a paycheck that is more than enough to pay all of your expenses as well as allow you to invest some money for retirement, or
2. Your business (either online or brick and mortar) is so profitable that you have lots of money to spend living out your wildest dreams.
However, if you are not careful, it all can be gone in an instant. Robert Kiyosaki, author of Rich Dad, Poor Dad, mentions in his book that in order to create wealth, you have to mind your own business.
How do you mind your own business?
You mind your own business by paying yourself first.
Simply put, in order to achieve financial independence and create wealth, you have to use a portion of the money from your paycheck or tax return and invest it in a vehicle that benefits YOU, not someone else, such as a mortgage company, credit card companies, etc. Don’t get me wrong; paying monthly expenses is very important. I make sure that I pay these expenses on time. However, I know that it is also important to have enough money set aside for my retirement years, as I have no intention of working into my 80’s and beyond (if I’m fortunate to live that long, God willing, lol).
How do you pay yourself first?
You do this by first doing your due diligence and research on investment vehicles that give you the most “bang for your buck”. Second, you then take action and actually go through with investing your money. You do not need a huge amount of money to start investing; you can start investing with small amounts. The important thing is just to start–somewhere. If you wait until you either “have enough money” or for “the right opportunity”, be aware that the clock is always ticking and once the time passes, it cannot be made up. Remember the old saying, “Time waits for no one”.
There are several vehicles that you can use that will help you save money for retirement, such as:
- Mutual funds
- Stocks and bonds
- 401k’s and 403b’s
- IRA’s (Traditional and Roth)
- Self-directed IRA’s
- Real estate investments
Which vehicle will give you the most “bang for your buck”?
I cannot advise you as to which vehicle listed above is best; I think it is an individual choice based on your comfort level of risk and other factors. Since I am not a financial adviser, I would highly suggest you speak to a tax accountant, licensed financial adviser and/or financial planner. As I mentioned before, do your due diligence and research on the investment vehicle you want to put your money in.
I hope that I have given you some insight as to the importance of paying yourself first in your journey towards building wealth. If you want to get started building wealth but do not have the money, I suggest that you check out my #1 recommendation for earning income and building wealth. Remember, the sooner you get started, the faster you can achieve either of the scenarios I presented at the beginning of my post.
I sincerely welcome any comments or questions you may have regarding this. Feel free to leave your comments below. Thank you for taking the time to read my post.
“It’s healthy to be wealthy”
2 thoughts on “Mind Your Own Business by Paying Yourself First”
I like the idea about minding my own business, and paying myself first. For me turning the concept into reality seems to be a problem, since the government gets to my paycheck first. I was thinking that I should match what the government takes out and investing it into hard assets.
Do you have any suggestions?
Thanks for your comment.
Don’t worry about the government taking their “cut” of your paychecks. As long as you are an employee, the government will continue to take their cut. The more you make, the more they will take. Therefore, I suggest you pay yourself first by working with what money is remaining in your paycheck. The best solution is to stop being an employee and instead become a business owner/entrepreneur. In the meantime while you work towards that goal, I like your idea of matching what the government takes out and investing it. I would just pick one of the mandatory taxes, such as social security to start with.
Wishing you the best of luck,