Picking up where we left off, this is a discussion of the Automatic Millionaire Chapter by Chapter Summary series. The book review can be accessed here and the chapter action step review’s links will be added to the book review as they become available.
This chapter illustrates the fundamental point of the whole book: Decide to Pay Yourself First and Make it Automatic.
The action steps are:
- Forget about budgeting. The book talks about budgeting as something that is too cumbersome and something that not everyone can benefit. David Bach also argues that his method does not really require budgeting because if you pay yourself first, you are free to use the rest of your income as you wish. Hence, no need for a budget. I personally is a numbers person, and I will always keep a budget just so I can see which categories I spend money in so I can adjust accordingly which in my opinion enhances his method of automation
- Forget the get rich quick schemes: Don?? be tempted with these types of schemes since most of these are lies! Just remember that if you save a small amount a month, the money adds up, and through time, you will accumulate much wealth!
- Commit to paying yourself first: paying yourself first refers to putting the money into savings/retirement accounts first before you get a chance to pay your bills (paying someone else). This is very important. If you can put the money into your savings first, then you won?? have a chance to spend it
- Decide whether you want to be poor, middle class, or rich, and choose the right percentage to pay yourself first: Obviously, the more percentage of your income you save, the richer you will be down the road. The idea is to decide ahead of time a fix percentage, and then have the money transferred to your savings before it even goes to your checking account.
Interesting points? Stay tuned for the next chapter titled Now Make it Automatic!
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- Automatic Millionaire – The Latte Factor – Becoming an Automatic Millionaire on Just a Few Dollars a Day Chapter Summary
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