Setting My Own Salary
Shane’s question about what percent I save each month made me realize that I hadn’t talked about how I set my own salary a few months ago.
I reviewed my monthly budget back in June, which is something I try to do every few months. I’ve always had an entry for “Savings” but I’ve never done anything proactive to make sure I was actually saving the money. Instead, I just assumed I’d transfer that money on my own once I had it. I didn’t apply the advice my Dad taught me years ago, “Pay yourself first.”
So now that’s what I’m doing. I set up my direct deposit to automatically split between multiple accounts, but if that wasn’t an option I could set up a scheduled transfer to move the money once it was deposited in to my checking account. Every paycheck, the amount that I had budgeted for myself goes in to my local checking account. Everything else, whether it’s $50 or $500, goes to my ETrade savings account. I never see the money, I never have easy access to it, and the path of least resistance is to leave the money at ETrade and let it accumulate interest.
Thanks for the reply. These are all good ideas. I’ve always been a fan of the “pay yourself first’ mode of thinking. However, I never seem to actually, really do it. mint.com has helped me understand my spending habits, but I still feel somewhat disconnected from all the transfers I have setup. After my direct deposit happens with my salary, I have three different transfers that automatically kick in going to 2 different savings and one to an investment account, then my bills come out through direct withdrawl at random days during the month. I wish there was some way to have all my bills come out on say, the 1st of the month. Have you found a good way to manage all this chaos, or are you able to rise above the cloud and look at everything from a global perspective - in other words, it doesn’t matter to you when money moves around, as long as it does? mint is great, but I feel like I need something beyond a web 2.0 tool, I need a new way of thinking.
shanereiser - August 26th, 2008 at 2:45 pm