Your Future Depends on the Need to Pay Yourself First

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I hope this finds you well.

Welcome to another edition of The Matt Viera Newsletter.

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I had a bit of deja vu last week.

Last week, I was working from home, and it was an absolutely gorgeous day outside.

Blue skies, picture-perfect clouds, and the temperature was just right - warm without being humid.

And what was I doing for most of that day?

That's right. You guessed it. I was working.

I was stuck inside, sitting in front of my computer, working.

Here's where the deja vu comes in: I had the same exact feeling before in a previous career.

I remember the day like it was yesterday. 

I was sitting in my office (of the law firm I was working in in New Jersey), reviewing some documents, and the emergency exit door to my office was open.

It was an absolutely gorgeous day outside.

Blue skies, picture-perfect clouds, and the temperature was just right - warm without being humid.

However, a few months later, I quit that particular job to work at a law firm in Manhattan.

Almost 2 years later, I quit practicing law full-time altogether.

I can't quite remember what I said to myself that time in my law office.

But I remember what I said to myself last week when working from home.

I said to myself: "If I only managed my money effectively when I was younger. I wouldn't be trading my time for money today."

I can go off on quite a few different tangents based on that.

But, I want to focus on the effective management of money coupled with the need for a solid foundation in financial literacy.

The truth is, I was never taught, in school or otherwise, anything about the effective management of money.

Like most people, when I started working, I received a paycheck, paid my bills, and spent whatever was left over. If I didn't have enough money to buy what I wanted, I turned to credit cards. That debt escalated.

Before I knew it, I received a paycheck, paid my bills, paid the credit card debt (probably the minimum monthly payment), and then spent what was left over.

But what was left over was not enough. 

So, I applied for more credit cards.

And so on and so forth, progressing in the value of items I bought (that I didn't need) on credit.

Don't get me wrong, I still buy things I don't need just for kicks and giggles. And there's still much I can do better regarding money. But, there are a few actions I am taking now that I wish I had taken much earlier in life.

What am I doing now that I could've done back then?

I am paying myself first.

Before I pay my bills, withdraw cash from an ATM, or buy anything I don't need, I pay myself first.

I automate ~25% of my pre- and post-tax income into various financial accounts.

A big hunk of that money comes out of my paycheck and is deposited into my employer-sponsored retirement account before the rest is deposited into my checking account.

Contributions to my various investment accounts are debited from my checking account every Friday.

It's like a well-oiled machine; it's money I don't even think about because I can still pay my bills and spend whatever is left over.

All of these various financial accounts perform exceptionally well for me.

My two investment accounts are up well over 20%, my retirement account is up 7%, and my high-yield savings account is a flat 5%.

And this is what I meant when I said to myself last week, "If I only managed my money effectively when I was younger. I wouldn't be trading my time for money today."

If only I managed my money back when I was younger the way I do now.

Now, here's the flip side of the coin: if I did have a grasp of financial literacy and effective money management back when I was younger the way I do now, would I have done anything different concerning money?

Probably not.

I'm willing to bet money if I could travel back in time and meet 22-year-old Matt to say, "Hey man, when you turn 50, you will have an epiphany and will no longer want to trade your time for money. Try to save and invest at least 25% of every paycheck you make for the next 28 years. Trust me."

22-year-old Matt would nod in agreement and hug 52-year-old Matt after saying, "Thank you. I appreciate the advice. It was great meeting you."

And then he'd keep managing his money the way he has been.

Keeping his head above water financially, not missing any credit card payments, and assuming there will be another paycheck.

I don't know. Maybe he'd do something different. But I doubt it.

Who the heck wants to think of the future when you’re enjoying the present?

So, what's the point of all this?

The point is to say don't be like 22-year-old Matt.

Try to save and invest at least 25% of every paycheck.

There's never been a better time (and it's never been easier) to automate contributions into your retirement account, deposits into a high-yield savings account, and money into a simple investment portfolio.

Invest a bit of time to figure it all out.

I assure you, there will come a day when you're sitting in your office at work, and it's an absolutely gorgeous day outside.

Blue skies, picture-perfect clouds, and the temperature is just right - warm without being humid.

The last thing you'll want to do is let time slip away by sitting in your office when it's absolutely gorgeous outside.

Take it from 52-year-old Matt.

What caught my attention:

“The No. 1 mistake that can lead highly successful people to burnout”

You can find the collection of financial tools & resources that helped me grow from a 6-figure debt to a 6-figure net worth by clicking here.

Thanks for reading!

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