You might be scoffing, thinking I obviously don’t understand your financial situation. But hear me out…
Tell me, why do you have to look at your balance in your personal checking account to make sure you have enough to cover a bill or to pay for something you want?
Where did it all go?
It feels like it was a good month at the gym…lots of new members, plenty of renewals, low attrition.
“I was certain I’d have plenty left over.” Funny how your profits seems to pull a Houdini magic trick every month when it’s time to pay yourself.
This cycle will continue unless you Pay Yourself First.
Most people pay all of their bills at the gym and bills at home before they pay themselves anything (Matt and Peter…sound familiar?). Wouldn’t it be nice to set aside a little bit each month toward retirement, toward the principle on your mortgage, or even to treat yourself to a weekend away with your significant other?
However, each week and each month you find yourself continuing in the same pattern, always wondering why you can’t seem to get ahead.
Paying yourself first means exactly that. Each month write yourself a check for your salary, it could be as little as $1,000. Even better, automate it so you have an automatic transfer from your business account to your personal savings account.
Nearly every bank provides this automation through your online banking service/bill pay. Before you start paying bills at work or at home, make sure you pay yourself.
You can even go one-step further and at any online retirement fund website, i.e. www.fidelity.com, set up your Roth IRA and have $416 automatically deposited into your account toward a fund of your choice.
By the end of the year, you will have maxed out your $5,000 limit on your Roth IRA account. Do that for 25 years and you’re going to look pretty good come retirement time.
Maybe you already have a strong retirement account building, but you would just like a toy or an occasional vacation to be able to enjoy life a little more. There is nothing wrong with that…you only live once…so live it up!
A new motorcycle or jet ski can be yours for as little as $80/month (That’s only $20/week for a fun toy to play with!)
However, you might wonder what happens if you don’t have enough left to pay your bills after paying yourself? It’s funny the phenomenon that happens. When you pay yourself first, your pressure to pay your other creditors is so strong that it forces you to work harder for that extra income.
Without even realizing it, you follow up with a few more missed guests, you ask a few more people for referrals, you spend a few extra minutes training your sales staff, you take an hour and attend your local Chamber of Commerce event, you take a moment to ask members if they would like a refreshing post-workout drink, you send an extra thank you card or gift card.
You’ll work more efficiently rather than waste time, you’ll become more creative in the ways you can generate more revenue at your gym, and it will make you smarter and more proactive when it comes to your personal finances.
Bottom line: It will not take much to make that extra mo’ney. However, because you paid yourself first, you know you need to be a bit more productive this month. However, it’s a wonderful feeling writing yourself a check each week or seeing your shiny new motorcycle or anticipating that weekend getaway with your family.
Try it. You might just like it!
Dedicated to your success…
P.S. Seriously, go write yourself a check for $1,000 right now and see just how quickly you can make it back. You will surprise yourself!
What do you think? Have you tried this? Are you nervous about trying it? Let me know below!