June 27th, 2006
For those of you that are in the habit of paying yourself a portion of your income each month (hopefully for the purpose of investing and growing your wealth), I have a question. What do you do if there is some financial emergency during the month that makes it impossible to pay yourself a portion of that month’s income?
For example, one month my car died and I had to replace the engine. I used the money in my checking account – not savings – to cover the expense, but was then unable to pay myself 20% of that month’s income (20% is what I try to pay myself each month). My budgeting system still shows that I owe myself for that month and I intend to pay it off as my checking account recovers from the car expense. I would like to hear what others do in similar situations. Do you keep a running self-debt balance or do you just forget that month and start paying yourself next month when cash isn’t as tight?
Entry Filed under: Saving