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Pay your self first and other money lessons

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It is now almost the end of the March is Money series and I thought it would be useful to look back at the previous 22 posts and recap the key lessons.

The most important lesson I’m going to start with is pay yourself first. When you get your money from either your employer or you get paid by clients, you need to pay yourself first by transfering money to either your emergency fund or your savings account.

Saving becomes a lot easier if you set yourself goals. If you’re struggling to get started with savings then you need to set yourself some clear goals. Ben Lumley from 6aliens.com showed us how and also how to learn form others.

Millionaires typically save around 20% of thier income. So once you’ve got into the habit of saving a regular 10% of your monthly income each month, you need to look to ways to increase this to 20% of your monthly income.

The key to saving money each month is to understand where the money goes and develop a conscious spending habit. The good news is some big savings can be achieved without pain by focusing your spending on just the things you love and being ruthless with the things you don’t care about.

For many people clearing debt is one of their most immediate financial priorities and in how to control your debt we covered how to pay your credit card debts more quickly which many of you found of use.

In our Wenesday Wisdom series we have featured book reviews covering Rich Dad, Poor Dad, Multiple Streams of Income and I can Teach You To Be Rich which have been some of the most influential personal finance books I’ve come across.

But, whilst managing money can be seen as a complicated process, we featured a prescription to manage your finances which several people have emailed me to say how much it has inspired them to get started. Fantastic.

In this special month dedicated to making the most  of your finances what lessons have you learnt?

We have written one more post which is going to appear as a guest post on another blog. However, you can get that post if you’re a subscriber to the mailing list.   Sign up now!

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Related posts:

  1. Spend money on the things you love
  2. How to control your money
  3. March is Money Month
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20 Comments »

  • Eleanor Edwards said:

    This has been a great series Matthew and I appreciate this round up because it allows me to catch up on the ones I missed due to being a hermit these last few weeks! I also really love the way you make money stuff interesting and accessible.

    The biggest lesson I’ve learned has been about spending on the things you love. I’ve also applied this to my time too. It’s very easy to fritter away both time and money on stuff that doesn’t really drive us wild with excitement. Whilst I have to wash the dishes (something that I can’t say excites me!) I don’t have to sit watching trash on the telly. I’ve chosen to invest my time in me and the things I enjoy.

    Thank you again for this series. Have you thought about putting it into an ebook format now that all the hard work of writing the content is done?
    .-= Eleanor Edwards´s last blog ..1 Minute Motivator: People are your greatest resource =-.

    Matthew Needham Reply:
    March 30th, 2010 at 5:50 pm

    Hi Eleanor, I realised I was missing a post last night (was hidden in drafts) so im going to issue the final post as a ‘subscriber exclusive’. It will also appear as a guest post elsewhere.

    It’s a good idea about the ebook, I’ll get on with that I think a lot of people would find it useful.

    Thanks as always for great comments!

    Matthew

    Matthew Needham Reply:
    March 30th, 2010 at 5:53 pm

    Ps really glad you’ve enjoyed the series and you’ve got something out of it. Investing in yourself is the best decision you’ll ever make.

    Eleanor Edwards Reply:
    March 30th, 2010 at 9:45 pm

    Thanks Matthew. I look forward to the exclusive post and glad you like the ebook idea. Not unique but easy to put together in these circumstances. And you’re right, it will be very useful.

    I’m just sorry I’ve not been around as much as I would normally like but better late than never ;)
    .-= Eleanor Edwards´s last blog ..I hate surprises, what about you? =-.

    - 30 March 2010 at 10:03 am
  • Moon Hussain said:

    Matthew, your series has made me re-inforce my savings habit. I’ve never been a big spender but there are splurges I go through. For instance, I bought not one, but two full priced PS3 games just two weeks ago ($120).

    I need to buy shoes and clothes, but I’m glad to say that I won’t get carried away and this shopping will NOT be at the expense of my savings.

    I need to do it though!
    .-= Moon Hussain´s last blog ..Are You Embarrassed Of Saying “Passive Income” Out Loud? =-.

    Matthew Needham Reply:
    March 30th, 2010 at 5:42 pm

    Hi Moon, this is excellent news. I’m really pleased. Are you taking part in the 30 day challenge to save £1000/$1000? thanks for your comment.

    - 30 March 2010 at 3:05 pm
  • Mars Dorian said:

    Holy crap,

    Truth to be told, I never worry about finances.I somehow believe in the law of attraction, and that really works out for me.

    However, I do save 10-20% of my income, unconsciously or not !

    Rich Dad, Poor Dad. I have heard a lot about it.Would you recommend it to someone like me, Matthew ? ,)
    .-= Mars Dorian´s last blog ..How To Increase Your Brand Value, and Why You Can Not Screw This One Up ! =-.

    Matthew Needham Reply:
    March 31st, 2010 at 7:00 am

    Hi Mars,

    Thanks for your comment. The fact that you’re managing to save, when so many are over spending is fantastic.

    Rich Dad Poor Dad is an amazing book. It’s a very simple story where you can draw lots out of it, no matter how experienced you are.

    - 31 March 2010 at 1:18 am
  • Ben said:

    This has been such a great series Matthew.

    I really appreciate you spending the time to sharing your wisdom on this topic. Thank you
    .-= Ben´s last blog ..6 outstanding ways to support someone in their dreams =-.

    Matthew Needham Reply:
    April 2nd, 2010 at 12:37 am

    Hey Ben, glad you’ve enjoyed it and I hope it’s inspired you with your own finances.

    Ben Reply:
    April 2nd, 2010 at 6:43 am

    Yeah it really has Matthew. I’ve already started seeing my finances differently and taking action.
    .-= Ben´s last blog ..This week’s Personal Development Homework =-.

    Matthew Needham Reply:
    April 2nd, 2010 at 6:53 pm

    Exellent Ben, I couldn’t have hoped for anything better. Thanks for your comment.

    - 31 March 2010 at 10:23 am
  • Eric said:

    I see a few posts I’m going to have to check out before too long but had to comment here first.

    I like the idea of paying yourself first, no matter what. Even with having a little girl now and how tight money is and such, it’s good to put back any amount, and realistically I’m talking around 5 to 10 a month at the least or somewhere in there.

    And yes, the more often you do it the easier it becomes later on down the road. It’s always good to start right now also!

    Good article Matt! :)

    Matthew Needham Reply:
    April 2nd, 2010 at 12:36 am

    Hey Eric, I’m glad you’ve found inspiration here. Most people save from what they have left over, after they’ve paid their bills. And surprise! They don’t have anything left because they’ve spent all their money. So paying yourself first means that you have to control what you spend.

    Think about savings as saving a dollar a day…could you do that?

    Good luck!

    Eric Reply:
    April 2nd, 2010 at 4:31 pm

    I could probably a bit easier than my girlfriend as I’m more of the saver but we’re quickly learning and taking control each day.

    For a long time I spread the word about my favorite budgeting software, YNAB. Back then I didn’t always understand but I do more now… Even a program can help you save money but only if you have control enough to save money. It can show you how and why but it can’t do it for you.

    Pay yourself first and thank yourself later. Pay yourself later and you’ll never have money.
    .-= Eric´s last blog ..Have You Done It Yet And If So, Have You Learned? =-.

    Matthew Needham Reply:
    April 2nd, 2010 at 6:50 pm

    Excellent comment Eric, I’m not familiar with YNAB. I shall check it out. Thanks!

    - 31 March 2010 at 4:18 pm
  • ayo said:

    hi mathew,
    how are you?
    just wanted to say thanks for running this series for the month of march, i was really enlightened and in no small way. looking forward to your themes in april.
    have a lovely easter break
    .-= ayo´s last blog ..Resolving Conflict In Relationships =-.

    Matthew Needham Reply:
    April 2nd, 2010 at 6:52 pm

    Hello Ayo, thanks for your comment. I’m glad you’ve found things of use here. It’s been an exciting month as I didn’t know everything I was going to write about when I started the month. You have a lovely bank holiday too.

    - 2 April 2010 at 6:24 am
  • Olusegun said:

    Hi Matthew,

    Thanks for enlightening and reminding me of the fundamental ways of becoming financially secure.

    It is so simple yet most of us (including the global financial experts )ignore it and suffer dearly.

    I read the millionaire next door in 2008. I think it’s high time i read it again.

    Have you read it yet?
    .-= Olusegun´s last blog ..THE MOST POWERFUL YOU =-.

    Matthew Needham Reply:
    April 6th, 2010 at 9:08 pm

    Hi Olusegun, thanks for the comment. I’ve not read the millionaire next door, but I’ll check that out as you recommend it. As you say, just becuase rules are simple should be ignored at your peril. Thanks again, Matthew

    - 6 April 2010 at 6:05 pm