46 - Invest 10% of your income - pay yourself first as your top personal investing strategy!

Reason for this Goal:       The single best personal investing financial habit you could develop is to pay yourself first.   Take 10% of each pay cheque and invest it into appreciating assets.  Just like you would pay all your expenses (car, insurance, utilities, mortgage, etc.), consider the “Pay Yourself 10%” as a mandatory expense that you pay.  

If you want to be really wealthy, double the 10% to 20%.  You will be happy you start this key financial habit, as this single habit will (should) allow you to become a millionaire before the time you retire.    Much sooner if you adopt 20%.

Understanding assets and why you should focus only on the appreciating type!

With personal investing, there are other many appreciating asset classes to invest in to develop your net worth.  In general, you want to buy things that go up in value (appreciate) versus things that go down in value (depreciate).  

Appreciating Assets

  • antiques
  • art (quality for reputable artists)
  • bonds
  • collectibles
  • classic cars
  • diamonds
  • dividend paying stocks
  • index funds
  • jewelry (quality)
  • guaranteed investment certificate (GIC)
  • gold
  • land
  • mutual funds
  • real estate (residential, commercial, vacation properties etc .)
  • Real Estate Income Trust (REIT)
  • silver
  • stocks
  • etc.

Depreciating Assets

  • all terrain vehicles (ATVs)
  • boats
  • camping trailers
  • cars and all types of vehicles - most new vehicles depreciate approximately 50% within 3 years from the time of purchase.
  • clothes
  • computers
  • electric tools
  • electronics
  • furniture
  • lighting
  • machinery
  • music instruments and equipment
  • recreational vehicles
  • snow mobiles
  • trucks
  • etc.

Assets generally depreciate due to wear and tear through the passage of time and other key factors such as obsolescence.  Most people are interested in purchasing new products and that is one of the main reasons assets depreciate due to the law of supply and demand. 


To understand Personal Investing . . . 

To really understand this concept of paying yourself first, read The Wealthy Barber, by David Chilton.  This is a legendary book and a must-read book for all those new to investing. 

To understand how to invest in the stock market, read about the investing strategies of the # 1 investor of all time: billionaire, Mr. Warren Buffet.   

To understand the benefits of real estate investing, check out my page on Real Estate Investing Goals .  We own four homes on our street known as Gables On The Park and this was one of the foundational keys to our success. 

With the application of this goal, and the benefits of learning about compound interest (discussed in Goal # 41 - Learn Personal Finance 101), you benefit the most by starting to invest in appreciating assets as soon as you start earning income, to have the maximum benefit of time for the compounding to work for you.  


Take time to develop your personal investing strategy.  Ensure that paying yourself 10-20% first becomes a key component of your strategy.  

Suggested Goal(s):   Put 10% of each pay into an appreciating asset account.   
Your Outrageous Goal:  Own > $X in appreciating assets by retirement.

Return to financial goals.