I Will Teach You To Be Rich: No guilt, no excuses - just a 6-week programme that works

by Ramit Sethi

If you’re paid twice a month: Replicate the above system on the first and the fifteenth – with half the money each time. The key is to make sure you pay your bills on time, which is why it’s important to move your bills’ due dates to the first of the month. Now – to oversimplify it for explanation’s sake – you’ll pay your bills with your first salary instalment of the month, and you’ll fund your savings and investing accounts with your second one. I’ve also got two other options for you to use this system if you’re paid twice a month: ▪ Another way to work your system is to do half the payments with one salary instalment (retirement, fixed costs) and half the payments with the second instalment (savings, guilt-free spending), but that can get clunky. ▪ Save a “buffer” of money, which you can use to simulate getting paid once a month. You’re essentially using a pool of money to pay your bills and contribute to your savings and current account, then getting “paid back” by your salary each month. For example, if your take-home pay is £2,000/month (or £1,000 fortnightly), you could keep £4,000 in your current account and follow my automation system as outlined in this chapter. Why £4,000? Because each month, your automation system will begin transferring money for bills and savings, and you want to build in a little extra in case something goes wrong (such as your salary arriving late). If you can afford to do this, this is a great way to simplify your system and simulate gett...