The Ideal Saving Habit: RECEIVE salary – SAVE & INVEST = SPEND the leftoverNo matter how small, learn how to save a portion of your salary for the purpose of investing. You may have heard about the 10-20-70 principle before. To help you accomplish the ideal saving habit, we recommend that you do the same thing.Upon receiving your salary, divide it accordingly: 10%, 20%, and 70%.Take the 10% which you can save for your emergency fund, or for paying off debt. Or if you are religiously inclined, you can give it to where you receive your spiritual nourishment. This is what they call tithing.Next, set aside the 20% for your savings and/or investments. Separate it immediately and deposit to a different bank account or into your investment.No matter how small, keep on saving until you have enough to start investing. Ideally, only 70% should go to expenses. The key to do this successfully is to prioritize your important expenses first like bills, utilities, grocery, and food items.This might be very difficult to practice at first, since you got used to spending all your salary. It may mean adjusting your current lifestyle to accommodate your new investing habit. Do you really need to buy that Starbucks coffee or DVD?If the 70% will not be enough to cover everything you need, you can be flexible in doing this just as long as you set aside even a small portion for your investment.Remember, saving and investing for your future requires discipline. It is not easy, but this small act can make all the difference. - peso&sense
Posted on: Sun, 11 Aug 2013 01:05:06 +0000
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