Pay Yourself First

The best-selling personal finance author, Suze Orman, recently said, “I wouldn’t buy a cup of coffee anywhere, ever, because I would not insult myself by wasting money that way. You need to think about it as: You are peeing $1 million down the drain.” She goes on to say that coffee is a want, not a need. The barely noticed personal finance blogger and Certified Financial Planner™, Steve Byars, responded, “Horse Feathers!”

First, at our house, coffee is a NEED, not a want! Second, isn’t there already enough to feel guilty about without feeling guilty every time you spend $2?

Remove the financial guilt in your life: Get a financial plan so you know how much you should regularly contribute to your retirement accounts – like your 403(b), 401(k), IRA, etc. – in order to reach your financial goal of retirement or financial freedom. Then, contribute that amount each month directly from your paycheck – before it comes to you in cash. There, you’ve paid yourself first!

Now, don’t feel guilty about that desperately needed latte, because you aren’t choosing between it and your retirement. You’re choosing between it and a nitro cold brew with cascara cold foam.

Steve Byars, CFP®