ECONOMICS
BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Plan Your Future
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Pay Yourself First
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Pay Yourself Forward
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Pay Your Finances
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Detailed explanation-1: -When you pay yourself first, you pay yourself (usually via automatic savings) before you do any other spending. In other words, you are prioritizing your long-term financial well-being.
Detailed explanation-2: -What Is Pay Yourself First? “Pay yourself first” is an investor mentality and phrase popular in personal finance and retirement-planning literature that means automatically routing a specified savings contribution from each paycheck at the time it is received.
Detailed explanation-3: -’Pay yourself first’ is a reverse budgeting strategy where you build your spending plan around savings goals, such as retirement, instead of focusing on fixed and variable expenses. This prioritizes savings, but not at the expense of necessary expenses like housing, utilities and insurance.
Detailed explanation-4: -The rule states that you should spend up to 50% of your after-tax income on needs and obligations that you must-have or must-do.