I heard this tip from Brian Tracy on youtube and thought I would share this as it is quite handy.

I think it is a great suggestion that we should keep in mind for when that day arrives. Hopefully it arrives for you soon! It can be so difficult to save more money over time because the cost of everything just keeps going up. We can feel like we are running out of ways to increase our savings and this tip right here is a beauty. It just requires some discipline we should demand of ourselves.

What triggered me to write about this was a friend of mine just told me his wife got a $12,000 pay rise. Congrats to them! What followed surprised me somewhat was when he said they were going to buy two big new televisions!

Please don’t fall into this trap of instant gratification.

Before you know it, this $12,000 will become everyday expenses and evaporate any potential savings, so you end up right back where you started. The argument will be it is a one off purchase but I can assure you that this is not where it will stop. If the rise was $30,000, I am sure if would have been a new car purchase instead.

Is this an easy thing to do, save 1/2 of any pay rises or bonuses?. As Jim Rohn would say, “It’s simple”. “Not easy, but simple”.

If you are thinking of making an unplanned significant purchase after an increase, the best favour you can do for yourself is to set up an 50% automatic transfer into any savings/investment accounts you have and make sure it is done immediately. The important part is the ‘immediately’. This is simple, but not easy I know. But at least you can keep and spend 1/2 of it and reward yourself.

Good luck with this and happy saving!