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Paying Himself First

This article was written by in Investing, Saving. 2 comments.

Mike Rogalski is featured as one of CNN’s Millionaires in the Making. He’s a civil engineer working for the U.S. Department of Defense in Florida, making $84,500 a year.

He chooses not to take advantage of an IRA for retirement savings, instead investing $33,000 in stocks and mutual funds. With $105,000 already put away in his government thrift savings plan (at age 32), as well as a decent pension in the works, he doesn’t have to.

He has a sizable amount of cash on hand for regular expenses and emergencies, and his philosophy is “pay yourself first.” Compare his numbers to mine:

Every two weeks for him (equating to every paycheck for me), he invests $450 into his TSP. I invest around $100 into my 401(k), but this varies due to overtime worked. He invests $450 into mutual funds. I invest about $150 into my Roth IRA. He deposits $400 into his savings, and I deposit about $100 that I’m confident is safe from being touched for a while. Just about everything else for me goes to expenses.

Either I need to double my salary to match his or continue cutting my expenses. Maybe cable TV will be the next to go, saving $40 a month.

Published or updated July 12, 2005. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Luke Landes is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about Luke Landes and follow him on Twitter. View all articles by .

{ 1 comment }

avatar Hazzard

Millionaires in the Making is one of my favorite features on the web (from a PF point of view). I find it very interesting to see how people are doing and you actually get to see their picture too!! :)