How Can You Save 10 Percent of Your Pay?


From: "Business Course I" by Gary North
Lesson 40

"Wait, Why should I?"

First Thing's First

The question posits that it is desirable to save 10% of your pay. Believe me, it is.

"But How Could I Possibly?"

Problem is, ask anyone around you if they could save 10% and chances are they would respond either (a) they already are, or (b) it is impossible.

Do not let this deter you. You can do it.

Put your mind to it and you can save 10%. You are probably stretched pretty thin. Everyone is. You may think it is impossible. The same tune is sung everywhere.

Commonly people think that they can not save now, that they have too many bills or not enough income. But even more commonly, spending increases in lockstep with income gains.

"No, Really. How Do I Go About It?"

At a minimum - no matter how desperate you are - you can put a penny in a jar once per week. It is important to cultivate the habit of saving.

Make the determination to save 10%, and I will tell you the secret to success.

  1. Good news: you are done! The secret to success is to make the determination. If nothing else, save that one penny each week - without fail. Do not back down from this commitment and be sure that you will eventually save your 10%.
  2. Lockbox. Identify a secure place for your savings. Do no just stack it in your sock drawer; it will be tempting to raid it at the first sign of distress. The "lockbox" must be in a place not easily accessible.
  3. Superfood: for every paycheck, gift, sales or any other income, slam 10% into savings immediately. Sock away this cash before you even think about it.
  4. Secret sauce: reward yourself! a. Watching wealth accumulate is its own reward. b. Try this. Save up money before Christmas and only spend cash on gifts. If you do not have enough cash for a gift, do not buy it. When the credit card bills come in January, you will enjoy the best "Christmas present."


Now you have the strategy. Next consider these day-to-day tactics. Where exactly do the savings come from?

If you eat out at all, your search is over. You can easily squirrel away 10% by reducing or eliminating meals in restaurants.

"But that's impossible!" It is not impossible. You may have to spend more time shopping and preparing meals. But if you committed to save, you must make the effort somewhere. And you have committed.

The next whopper is a substance habit: smoking, drinking, coffee, candy. These expenditures are not necessary, and in most cases, self-destructive.

These are the "low hanging fruit." If none are available to you, you may have to take a different tack. a) increase income b) rein in spending by family members

Finally, here is one sure-fire way to build your habit of saving: pay down debt.

Commit 10% of your income to payments above the minimum required for your credit cards, car loan, or mortgage. Attack the highest interest debt first. Once the debt is eliminated, keep the 10% habit and build up savings.


A penny saved is a penny earned.

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