What does 'pay yourself first' mean?

What does 'pay yourself first' mean?

• A. Spend everything you have before saving.
• B. Save only after you treat yourself with a big purchase.
• C. Put money into savings before spending on other things.
• D. Invest immediately in stocks.

Answer: (C)

Pay yourself first means putting money into savings before spending on anything else. When you make savings a priority, you build a safe reserve and make steady progress toward goals like emergencies, college, or big purchases. Automating this helps—set up a regular transfer from your checking to a savings account right when you get paid so saving happens automatically rather than relying on willpower. The other ideas miss the point: spending everything first leaves you with no savings, saving after a big purchase means you’re not prioritizing saving, and investing right away is also valuable but not the primary focus of paying yourself first, which is about saving first in a safe place before other spending.

Pay yourself first means putting money into savings before spending on anything else. When you make savings a priority, you build a safe reserve and make steady progress toward goals like emergencies, college, or big purchases. Automating this helps—set up a regular transfer from your checking to a savings account right when you get paid so saving happens automatically rather than relying on willpower. The other ideas miss the point: spending everything first leaves you with no savings, saving after a big purchase means you’re not prioritizing saving, and investing right away is also valuable but not the primary focus of paying yourself first, which is about saving first in a safe place before other spending.