"What's the difference between 'paying yourself first' and saving money?" —Ayesha Paying yourself first is a way to save money. In fact, it's the best way to save money. The trick is that rather than setting extra money aside, you're saving for yourself and your future goals right away, before spending the rest on non-essentials. Treat the savings goal like an important bill—just like your rent or mortgage—that must be paid every month. The only difference is it's a bill you pay to yourself. "Anybody can save the remnants of a paycheck after they've spent most of it," says George Galat, a California-based financial adviser. "[Paying yourself first] is purposeful, proactive and implies a level of progression toward a collection of goals," says Galat. Here are a few ways to pay yourself first—without feeling like you're making a big sacrifice.
1. Set Up Automatic Payments
A common obstacle to saving your money is that the amount you planned to save tends to dwindle toward the end of the pay period. "The reality is that some competing interest always comes up to reduce if not eliminate well-intended savings," says Howard Pressman, a Virginia-based financial adviser. That's why one of the principles of paying yourself first is to set up automatic payments into accounts set aside for retirement, debt repayment, or emergency savings. That way you don't have to consciously think about choosing to save, and won't be tempted to spend it first. "If one has automatic savings taking place into the 401(k), Roth IRA or a sweep from checking to savings, it's going to get done," Pressman says.
2. Max Out Your 401(k) (If You Can)
One of the first areas of your financial life you should pay attention to is your retirement savings. But most people still aren't saving enough. One in four workers have less than $1,000 saved for retirement. Setting aside 10 percent or 15 percent of your income may seem daunting, but is not as impossible as it might seem. When Jon Haagen, a New York financial adviser, asks people if they can save 15 percent, they usually disagree. However, when he rephrases to ask whether they might be able to live on 85 percent of their income, most say that they can. "The second way of asking seems less daunting," he says. 
3. Change Your Mindset
Once you decide to pay yourself first, you may feel like you have a lot less money at your disposal than you once did. The key is to change the way you think about your income, and accept that you need to -- and can -- live off less. "It's really about fooling your brain into thinking 'this is how much I make and this is what I can spend,' said Jeff Maas, a California-based financial adviser. "Eventually you will adapt your spending habits to match your perceived income and it won't feel like a chore or a sacrifice to save." Written by Laura Sanicola for CNN. Got a money question for Broke No More? Ask us here to be included in a future column. The-CNN-Wire ™ & © 2017 Cable News Network, Inc., a Time Warner Company. All rights reserved.
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