Throughout your lifetime, you will produce a certain amount of income and you will adopt a lifestyle that can be supported by that level of income. Whatever that is, the first 10%-20% of that income is RIGHTFULLY YOURS to keep for your future. After all, you are the one who earned it and you have all of the rights to it. That is, unless you voluntarily give those rights away.
It is common to first pay everyone you owe money to, then attempt to save what is left over after the expenses of living. However, it is also a MYTH. Yet it is easily demonstrated that people will spend all of the money they have, therefore nothing is left over and one feels he, “can never get ahead.” This will be true for you unless you recognize this simple fact and act accordingly… The Prosperity Principle you may be violating is: “Pay Yourself a Portion of Your Income BEFORE Any Other Expenses.”
Possibly the most well-known financial principle in history is that one must take a portion of all of his earnings and pay himself first. This is because it can create the most profound effects on one’s financial prosperity. It’s even stated in The Holy Bible, 1 Corinthians 16:2, “On the first day of every week, each one of you is to put aside a sum of money in keeping with his income, saving it up, so that when I come, no collections will have to be made.”
“Savings” is an expense that must be taken out first—without exception. Then one has to realize that his actual income was only 80%-90% of what he earned. If a person spends all of the money he makes, he will only serve those to whom he is indebted and will not be able to survive periods of economic duress, therefore never truly get ahead financially.
I’m not advising you to default on your debts. Pay what you owe, but consider this question: “Can you save 10%-20% of your income right now and not miss it?” If the answer is no, then you are living a lifestyle that is too expensive for your means. It is just that simple.
Some define financial success as “making enough money to cover the bills.” However, if you aren’t paying yourself at least 10% of your income as the FIRST BILL you pay every month, then you aren’t really making enough money to cover all of your bills. Don’t delude yourself into believing that you’re doing great financially just because you can pay everyone else you owe without taking care of YOUR financial future.
If you have already adopted the habit of spending all (or more) that you earn, saving 10% may seem impossible. I promise you, it’s not impossible! In fact, I can introduce you to many individuals who have taken this advice, who also felt like you, yet were surprised how easy it really was once they started! Start slow if you need to with a lower amount and work your way up, making gradual adjustments as you go, but START TODAY!
For those who spend all that they earn without paying themselves first, there will never be stability in their financial position and true financial prosperity will be out of reach. This is true for an individual, a household, a company or a nation.
The route to financial prosperity can only be followed by those who save a portion of everything they earn. It is my hope that following this simple yet challenging principle will assist you with a much more positive and successful financial experience while you Live Your Art!®