Money Mechanics Blog

Saving money can seem like a daunting task, but with the right approach, it’s achievable. By reorganizing your budget and prioritizing your future needs, you can cultivate a strong saving habit that yields significant benefits over time.

What Does It Mean to “Pay Yourself First”:

“Pay yourself first” is a fundamental principle in personal finance, emphasizing the importance of saving for long-term financial security before other expenses. This approach could involve allocating funds towards retirement accounts, insurance covers, health savings accounts, emergency funds, debt repayment, and saving for future expenses or goals.

Why This Works:

Prioritizing savings before discretionary spending helps clarify available funds for essential expenses and discretionary items. By risking other mandatory expenses when prioritizing savings, individuals are more motivated to trim discretionary spending. This approach strengthens savings and ensures the fulfillment of living expenses.

Budgeting to Save:

Establishing effective savings habits begins with a comprehensive evaluation of your finances. Analyze your spending patterns to identify areas where reductions are possible, thus maximizing your savings potential. Adopt a budgeting strategy that prioritizes saving, such as the 50/30/20 technique.

How to Start Paying Yourself First:

1. Automate Your Savings: Simplify saving by setting up automatic transfers from your paycheck to designated accounts.
2. Prioritize Debt Repayment: Focus on clearing high-interest debts first to prevent interest from eroding your saving capacity.
3. Start Small: Begin building your emergency fund incrementally, even with smaller amounts, ensuring it’s prioritized over other expenditures.

Pairing your Allegius Share Savings Account with Allegius Easy Saver is the perfect place to pay yourself first. Allegius Easy Saver will round up purchases you make using your debit card to the nearest dollar and transfer the change from your checking account to your savings account at the end of each day. And the best part is, both are included with your Allegius membership!

Paying yourself first is a proactive financial strategy that fosters long-term stability and resilience. By reevaluating spending habits, prioritizing savings, and starting small, you can embark on a journey towards financial security and peace of mind even amidst uncertain times.

Enroll in Allegius Easy Saver using online banking or contact the credit union for assistance.