Over at No Credit Needed (updated link), the blogger has come up with a great idea of summarizing some of the best money saving tips from all around. There’s nothing like combining the knowledge of many people and taking the best 5% of that.
I read through them and was just shocked that the best money saving tip I ever heard was not included. Simply, pay yourself first. Set aside money from each paycheck to automatically deposit into a separate savings account, mutual fund, money market account, etc. The key is to have it in any account that you normally wouldn’t pay attention to or have easy access to.
The idea is that if you don’t see it, you won’t spend it.
I totally agree. We started “Paying ourselves first” last year and went from saving 6 percent to 29 percent. Now each time we get a raise that percent is increased.
Lazy Man and Money says
Anonymous, that’s a huge success story. Keep it going…
Why isn’t this concept being taught nationwide in our public schools, colleges, and universities? Could it be because those in charge don’t know this simple, yet profound principle? In light of today’s economic climate, managing one’s finances and saving for one’s retirement should be a top priority for every American. This article does an excellent job outlining several steps toward financial security. Especially useful is the concept of saving a percentage of one’s income. I just read about an interesting concept called the 10/90 principle – paying yourself first by investing in your financial future. It advocates paying yourself at least 10% of your income and living off the remaining 90% http://www.christianretirement.com While it may seem selfish to some, I feel that if I do not take care of my own financial needs no one else will. I have been following the 10/90 principle (paying oneself first) for years, and it works wonders for your finances. Great article lazyman and money!