My grandparents used to say to me, “Pay yourself first.”
Being only 10 years old at the time, I’d shrug my shoulders, give them my best thanks-for-the-advice look and say “OK.” But deep down inside, I didn’t really know what they meant. After all, I was just a kid with no money.
Thirty short years later, I’ve come to have a richer understanding of their advice and I use it to support the Air Force core values through balanced planning, prioritization and discipline.
Though we may never know who first uttered those words, the fact that they endure lends credibility to their soundness. In the literal sense, while living within one’s means, paying yourself first means setting aside money for one’s needs before fulfilling one’s wants.
For example, every month I unwittingly used to make sure all my credit card bills were covered, then tried to make life work with what I had left over. Now, I set aside money for my family’s goals and dreams first and still manage to pay my bills each month.
Enjoying life is one of the reasons I work so hard for my money.
The pay-yourself-first idea can be adapted to other aspects of life as well. It uses the same approach of balanced planning, prioritization and discipline. The intent is to invest in yourself while the resources exist and not letting external influences detract from planned goals. In practice, there are many ways to invest in yourself other than through personal finances.
Consider what happens after taking a class, learning a skill, practicing good diet and exercise or preparing for an upcoming event. I find I’m better equipped to accept change and better postured to tackle unforeseen obstacles. In the case of personal finances, setting aside 10 to 20 percent of my income for long-term savings and investments positions me to overcome a bad economy, provide stability for my family and ready us to do the things we’ve always wanted to do. In the world of fitness, investing in my well being affords me the tools to negotiate life’s obstacles and have peace of mind. Investing in my education yields higher pay opportunities, increased responsibility and a more diverse perspective of the world around me.
Investing in myself is where the Air Force core value of Service Before Self comes in. What? Sounds like the opposite, right? The pay-yourself-first concept I’m talking about is not a selfish act, but rather a strengthening of myself to be in a position to help others. Just like the safety brief you get on commercial airlines about putting on your oxygen mask before helping others with theirs; if I can’t help myself, how can I help others? Many of us volunteer our time to mentor, serve, comfort and contribute to worthy charities and causes. Developing myself in this way keeps me ready to help others. However, growing in this way has to be deliberate.
When I pay myself first, I strive for a balanced approach to planning. Many aspects influence my planning but here are a few: family, friends and career; short, medium and long term; wants and needs, known and unknown. Each aspect needs to be in the right balance or mix to make the most of my resources. I find that the balance shifts through time as things change, so I readdress my plans regularly.
Once my family and I decide on a plan, we prioritize the parts so we know which aspects in life will get our efforts when time and resources become constrained. To stay focused, I often think to myself, “A priority is what I’m doing right now; so, I need to make sure what I’m doing right now is actually one of my priorities.” My family and I are honest with ourselves in the process and shape our plan and expectations accordingly. Realistic expectations and prioritization are key to financial and long-term planning as they let us know where the trade spaces are to make the best use of resources.
With a prioritized and balanced plan, all that is left is to execute and that takes discipline. My family sticks to the plan and our contributions complement each other. To stay within our means, for example, I repair my own vehicles and my wife runs the spreadsheets that keep us on track. As life is unpredictable, we recognize that unplanned things pop up and then decide whether these things warrant a change to the plan or not. With discipline and good judgment, we make the best choice for us as we continue to pay ourselves first.
Pay yourself first and you’ll embark on a journey with a new perspective. Pay yourself first and you’ll reinforce the Air Force core values. Pay yourself first and one day you’ll pass this advice onto the ones who matter most in your life.