Pay Yourself First Even If You Have Financial Obligations?
Financial Management

Pay Yourself First Even If You Have Financial Obligations?

large business and finance

This was kind of an interesting observation I had as someone was showing me how he managed his finances as he is currently living on a very limited income. Basically, like most people he would take how much income he brings in every month and then tries to redistribute it appropriately to say pay off any bills or debt. I thought it was kind of interesting to see that at the start he would immediately take an X amount of dollars from his income and place it into his “entertainment” funds pool as oppose to paying off important things first and then seeing how much he has left for other things.

His reasoning was that you have to treat yourself first as things such as credit card bills have minimum payments and so there should be no immediate rush and you should be able to enjoy yourself first and foremost. While I’m all for the you have to treat yourself as well approach, I can’t see how focusing in trying to pay off any financial obligations that you may have first would not be the better route to go with. In some ways to me it seems a little irresponsible as it is kind of like you trying to prolong your financial responsibilities as much as possible. For example, instead of focusing in completing an important task first with the limited amount of time that you have, you decide that you will go to some party first and then work with what remaining time that you have on that task.

Doesn’t make much sense to me personally. If the whole intent is to have say less stress as everyone needs to relax, I’m sure not even having say a debt to worry about in the first place is better in the overall picture and so I’d say it is better to focus in paying off financial obligations first.

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