Oh my, I am in my 20s when I was thinking of those things. I also thought
of the time when I am no longer capable to work. I have to retire. When I
retire, I don't earn monthly salaries anymore. With no money, how can I buy
food, clothes, medicine, and other necessities? I don't want to be a burden to
my family.
This reality hit me and I'm glad it hit me hard because it made me
realized that I have to save money as early as now, while I still have a fit
body and mind to work.
I might not be the only one thinking about these things. So now, I’m
thankful for Bo Sanchez's book, “My Maid Invests in Stock Market… and Why You
Should Too” (Download The Book Here), I have something to share with you
regarding saving.
Discovery of the “Saving” Formula
Is this formula familiar to you?
Salary - Expenses = Savings
I believe most of us followed this or follow this, still. This means
that your SAVINGS will be derived from what’s left in your salary after
deducting all your bills and other expenses.
What's wrong with the above formula? Well, if you are planning to secure
your savings every month, then there’s something wrong with this formula. There's
a possibility that all your salary will be spent to your expenses and as a
result, you will have NOTHING to save.
Let’s compare the formula above with this one,
Salary – Tithes – Savings = Expenses
This formula means that when you get your Salary, you immediately deduct
your savings and tithes (give it to the Church that nourishes you). You live by
the remaining amount for your expenses and you have a sure amount for your
savings. Isn’t that great?
70-20-10 Rule
Now the question is “How much will be allotted for tithes, savings and
expenses?” That’s what the 70-20-10 stands for. According to the Bible, we
should give 10% for our tithing (that’s a minimum, not really restricted to 10%
only). For the savings, 20% is a good number and the 70% remaining is what you
use for your everyday expenses (until that next salary payout). In this manner,
you are able to save 20% of your salary each month.
Benefits of 70-20-10 Rule
This formula seems simple. At times it can be tough to follow,
however, following this entails a lot of benefits. Based from my experience,
here they are:
1. I've learned
to manage my daily expenditures.
Strictly
living by my 70% budget for expenses, I knew how to differentiate what’s a
necessity and what’s not.
2. I
become more disciplined.
Even if I
wanted to go to malls because of sales and promos, when I think I have 70% only
to spend I disregard the thought.
3. I
have savings I never thought I would have in my 20s.
After 2 years
of faithfully setting aside 20% of my monthly salary, and investing it in
Stocks with Bo Sanchez’s guidance in Truly Rich Club, my savings grew to almost
55%. (Know more about the Club or Join the club
here) I didn't imagine that this is the result of maintaining the 70-20-10
formula.
4. I am now able to give
10% tithes.
This is something I am happily giving. It gives me a sense of
fulfillment that I am able to give back to God a portion of what He has given
me.
The 70-20-10 rule taught me a lot in facing my financial challenges.
It taught me not to worry but instead to act. When budget gets tight, adjust
(no gimmicks for the time being, avoid buying expensive clothes, and take my
eyes off from those cool gadgets. Hehe) I am positive I will succeed in my
financial aspects if I continue this discipline. 70-20-10 is my “Saving”
formula. And I hope, it will be your "Saving" Formula too.
Let's all prosper!
Want to join Truly Rich Club and be truly rich?
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