OK, this is not a new idea, the Automatic Millionaire has been espousing this all along, but here are a couple of real ways to do this. Remember to pay yourself first, or in my case, remember to hide the money from myself so I don’t go off and spend it willy nilly!
- A previous employer had a way to deposit to up to 6 different bank accounts with my pay cheque, so I could actually deposit working capital into my chequing account and then spread savings money around to six different bank accounts.
- This lead to interesting ideas like a co-worker of mine who did the following. His take home pay at the start of the year was $X, so he set up his deposits to put $X in the account that he shared with his wife and any left over money went into another account. So, if he got paid overtime, it went into his account and when his EI and CPP payments ended THAT extra money went into his account too! Sneaky, I know, but it works!
- Most banks allow you to set up AUTOMATIC transfers on specific dates, which is what I do to shunt the money I save for my property taxes away, so I have it when the City of Ottawa comes to GOUGE me twice yearly. I put this money in a bank account instead of letting the city take a monthly payment, since I think I deserve the pittance interest payment on the money, not the City!
See if there are other ways to Pay Yourself first, or better still, Fool yourself first! Pay all of your other bills automatically too.