Saturday, January 19, 2008

Why You Should Pay Yourself Before You Pay Your Creditors

Got bills? We all do. But, who do you pay first when after you deposit your paycheck? Most people pay their bills first, and play with what little is left. Sometimes, they ll put a small amount into a savings account, which might earn all of 2% interest. Is this you? What if I told you that you should be paying yourself first, and not into a savings account, but a wealth account? Only read the rest of this article if you want to become wealthy. Why? I intentionally became a millionaire before I was 35, and now I teach others how to become millionaires. One of the first things I tell them is to pay themselves first, putting the money into a special account called a wealth account. Investing - in yourself and in building assets - should be your first priority Millionaires make investing a priority. They pay themselves first into this special wealth account. I call the payment you make to your wealth account your Wealth Account Priority Payment (WAPP). As the name implies, this payment is a priority, comparable to your mortgage or rent, bills, or any other priority expenses. Your WAPP should be a specific, set amount, and paid consistently, come rain or shine. Most of my clients make their WAPP monthly. The concept of paying yourself first is often misunderstood. I ve even heard financial advisors confuse this with putting money into savings. I ve seen others tell people not to start a Wealth Account if they are in debt. None of this advice will support and create lasting and ever-growing wealth. If you want to be a millionaire, you have to act like one today. And all millionaires use something similar to the process I call The Wealth Cycleâ„¢. It s a process in which the money you make is invested in a way that makes you more money. (I explain this concept in detail in my book, The Millionaire Maker). The investing aspect of The Wealth Cycle is crucial to its success. Pay yourself before you pay down your debt Now this may sound counterintuitive, but I don t care how much debt you have. You still need to make your Wealth Account a priority. Here s the 10 second lesson from the millionaire maker: You make money, put a portion of that into a wealth account. Your wealth account is used to invest in money-making assets. Then, pay what you can towards repaying the debt. In the mean time, the income from your investments grows, getting you out of debt faster! Once the debt is paid, you still have the income from the investments. What s important is not the amount of your WAPP. The key is a) starting it immediately, and b) getting in the habit of making it. If you are barely making ends meet every month, make your WAPP only $10. Or even 10 cents, if need be. Then as your income increases, raise the amount of your WAPP accordingly. Once you have gathered enough money to pursue a lucrative investment - and believe me, some times all you need is a just few thousand dollars - then you seek out a wealth coach, a mentor, and other specialized professionals who can guide you on choosing the best investment for your needs. And you ll soon see just how quickly you can build wealth when using the Wealth Cycle. Think of it this way: every month you don t make your WAPP compounds into days you re not creating wealth. Which means you ll stay in debt longer. Or simply keep the status quo. Isn t it time you took control of your financial future? Wealth building is possible for anyone who learns and uses the right skills at the right time. Loral Langemeier literally creates millionaires, and she does it using a well-honed and tested system that anyone can learn. Creating sustainable wealth does not need to remain a mystery! Order your copy of The Millionaire Maker today:

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