Where are you in the queue of people who want your money?
The First Law of wealth creation.
If you ask someone who they work for, they will probably give you the name of their employer or the name of the company. In a few instances they will tell you they own a practice as a lawyer, doctor, architect, or some other profession. In some instances, you may even get the sarcastic answer “I work for the Bank that holds the mortgage on my home / factory, or the hire purchase agreement on my car / vehicles.” But you will seldom get the answer “I work for myself.”
The sad reality is that most people (92%) work for an income, out of which they pay everybody else. The mortgage, the car, the clothing stores, the furniture companies, the grocery stores, the municipality for utilities, the petrol companies, doctors, dentists, the list goes on and on. And the name of the person who did the work and earned the income, your name, is not even on the list of beneficiaries.
Now I can almost hear you say, “But excuse me, who lives in the house, drives the car, eats the food, wears the clothes etc., etc.,“ Which is all true. There may even be golf money or club fees or other expenditure for even more pertinent personal benefits. But the fact remains that your name is not on the list, when in effect it should be the first name on the list. You do the work, so you should be the first person to benefit from the income.
An extremely wealthy, wise, old man once said to me. “It does not matter how much you earn. If you spend every cent of the income, you will be fine. If you spend one penny more than the income, you earn you are heading for financial disaster. But if you save even one penny out of every income amount you earn you will become a wealthy man.”
Well, let’s face it, if the average individual works for forty odd years that’s 480 months, saving a penny out of every salary will certainly not make you a wealthy person. But that is not what it is about. It is the principle of the matter. Making a habit of paying yourself first, out of the income you earn, ensures that you do not fall prey to the traps that business and commerce set for uninformed employees. Become aware of issues that are related to your ability to earn, and all the realities that are associated with that earning ability. I will deal with these in Chapter 4.
Make it a habit. Apply the Law. Pay yourself first. Every time you earn some income.
The more solid and robust the structure the greater the chance that it will serve it’s purpose.