Why You Should Pay Yourself First?
You’ve heard it over and over. Save your money, or in today’s terms, “pay yourself first.” Yet according to Bankrate’s 2026 Emergency Savings Report, 59% of Americans can’t cover a $1,000 emergency without going into debt. Less than half of Americans save money regularly. Take away employer 401Ks and pension plans, and the number of people saving on their own drops even lower.
Unfortunately, the days of working at a company for twenty-five years and receiving a pension are mostly gone and the need to have a “nest egg” saved for retirement grows more important with every generation.
Saving is Easy
Fortunately, technology has made it easy to pay yourself first. You can set up automatic withdrawals from your paycheck in minutes, and most banking is online now. Push a button, and you’re saving automatically, no thinking required.
Most people can start by enrolling in a 401K through their employer. If your company doesn’t offer one, you can save in an IRA every year and pay no taxes on that money until retirement. The tax savings alone add to what you’re able to put away. Saving money isn’t hard. If you want to go further, a little research or a conversation with a financial planner can show you other ways to save for retirement and lower your taxes.
So why don’t we save money? It’s simple. We’ve become addicted to having lots of stuff, and we want it now. We rarely stop to think about how much we’ll actually need to live on when we retire. Most of us act like we’re going to work forever, so retirement doesn’t cross our minds.
In my opinion, life is too precious to spend all of it working. Don’t spend all your money before you get to retirement, because someday, whether you want to or not, you will retire.
How to Start Paying Yourself First
Saving money is easy. Being disciplined about it is a habit you have to build. Here’s how to start. When you get your next paycheck, ask yourself who you’re going to pay first, the credit card companies and bill collectors, or yourself? The answer is easy. Pay yourself first.
If we all saved just ten percent of our income over our working lives, there might be no need for social security. In fact, social security may not be there for a lot of people who are working today. That’s exactly why learning to say no to debt matters so much. Every dollar that isn’t going toward interest and old balances is a dollar you can pay yourself first.
Maybe you think you can’t live on ninety percent of your income. I challenge you to try. Do it for a month and see if you can live on less. Start by saving ten percent. Take it out in cash, or set up an automatic deposit into a savings account, then pay your bills like normal. You’ll spend a little less on eating out or buying things you don’t really need.
What you’ll find is that you can live on less each month than you thought. The cool part about saving is that once it becomes a habit and you start seeing results, you’ll want to save more and spend less. It’s amazing how that works. You just have to make the commitment to pay yourself first. Ten percent is a good number to start with, but you can increase it as high as you want.
Pay yourself First
You can pay yourself more. Why not? The more you save, the sooner you can take that trip around the world when you retire. If you’re overwhelmed with debt and bills right now, start with just five percent instead of ten.
When you get a raise, give your savings a raise too. I do this every year. Whatever my raise is, I apply that amount straight to savings, on top of what I already put away. The point is to start now and make it a habit. You’ll be on your way to real peace in your financial future, instead of hoping social security is enough when you stop working. Start investing in your future today.
Want to put these Ideas into Practice
Life’s Top Ten® — Control Without Cutbacks takes four essential money principles—budgeting, paying yourself first, building a rainy day fund, and getting out of debt—and turns them into a simple, step-by-step system.