Every time we turn around we are paying taxes to someone. Income tax, sales tax, property tax, gas tax, etc. Get in on the action and boost your retirement or pay off your debt faster.
Here’s how. Make a commitment to yourself that you will take 50% of any new or unexpected income (raises, bonuses, or even the $20 bill you found on the street) and transfer it to your personal “tax” fund. Then make a plan to apply those funds to either debt reduction, savings or retirement funding. Then take the rest of it and do whatever you want guilt free.
By the way, this also works on new reductions of expenses. Say, your landlord calls and tells you your rent has been reduced by $100 a month (yeah, right). You start a monthly automatic transfer to the “tax” fund of $50 and spend the rest on fun stuff.
My wife and I applied this rule for 25 years and it was a painless way to fund our retirement.