The “Pay Yourself First” Approach to Budgeting

Can the same level of simplicity also allow you to pay off debt or invest without a budget? What if you took an approach to pay yourself first?

Pay Yourself First Approach to Budgeting

The pay yourself first approach to budgeting is less precise. With anything less specific, it does leave more room for error.

A conventional budget involves writing down your expected expenses every month and tracking them every month.

When You Don’t Have to Use a Traditional Budget

The Alternative: The “Pay Yourself First” or “Anti-Budget” Method

The simple explanation is that we save and invest before we do anything with our money.

Track Your Spending

Having a baseline will allow you to determine the current gap between income and spending to develop a plan.


Automate Your Monthly Payments

Automating your finances allows you to hide money from yourself essentially. As silly as it may sound, the psychology of this is powerful.


Spend the rest

This gives us the freedom to spend the remaining money on whatever we want, guilt-free. This is referred to as fun money; we’re just getting to the number differently.


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