8. Pay Yourself First What's the Best Method for Organizing Your Saving Activities? Virtually all financial analysts agree that it is best to start saving early save regularly, and shift to another savings goal and a higher-yielding investment when you achieve a particular savings goal. Sometimes the most difficult question is: "How do I get started and how do I maintain my momentum?" One of the easiest answers is: "Pay yourself first." What does it mean to pay yourself first? It means make your saving activities your first priority by paying yourself, or making contributions to your savings accounts any other obligations you pay This saving strategy has the following advantage It ensures that funds will be saved -as opposed to saving only if sufficient funds remain after all other bills are paid and any impulse purchases are made. It ensures that funds will be saved if any remain after all other bills are paid and any impulse purchases are made Therefore, paying yourself first imposes on the act of saving It is recommended that one of the first goals of a savings program should be the accumulation of an emergency fund equal to three to six months worth of living expenses. Let's examine this savings objective further What is the purpose of an emergency living expense savings fund, and what other sources of funds are sometimes used to address these needs? To accumulatele funds that allow you to cover the following household costs: Living expenses in the event of a job layoff, illness, injury, or the premature death of an income-generating member of the household Expenses incurred during vacations, holidays, and birthday celebrations However, most people don't maintain an emergency living expense savingsfund; instead, they expect to rely on to pay their living expenses during these expensive and stressful events. The downside, or negative consequences of this strategy is that it reduces, rather than increases, their wealth as it involves the payment, rather than receiving of