How To Save Your Money - Personal Finance

Hello, I hope you are doing great 😉

Today, I just chilling around and I said why I'm not sharing some of my knowledge here about saving money, of course, I'm talking about personal finance not business stuff, and all of those breaking heads things.

So without too much talk, I want to give you the 3 rules in saving money in the personal finance which is: 50 / 30 / 20

Maybe you asking what the heck is this rule about? calm down everything will be clear, it's simply 50% and 30% and 20%, em is that makes no sense to you? Ok, let me explain more.

If we will divide our life, there are serval amount of factor that determinate someone wealthy compares to another one, the main factor is the wealthy one know their needs and wants those 2 words are the key Need & Wants, if you really want to be a wealthy person you should probably analyze your needs and wants, that's what we wanna do right now.

Now I can give you the meaning of 50/30/20 are the percentage of financial success, of course in saving money as I said before I'm not talking about business because this is another complex topic (I will make an article about it later on) this topic is just for mid-class people or average people.

1. Needs: 50% of your budget
2. Wants: 30% of your budget
3. Saving or paying off debts: 20% of your budget

Because a lot of people get confused when determinate the real differences between needs and wants I will explain that more 

Need is something you can't live without, eg:

• Groceries
• Housing: rent...etc
• Health
• Utilities: electricity bills, internet bills, phone bills...etc

Want is something you desire, but can you live without, eg:

• Shopping
• Dining out: why I consider this like that cause eating outside cost more money than prepare your food at home
• Hobbies

I hope you got the idea of the needs and wants, now let's make an example for simulating this method.

Let's suppose you earn 10 grand a month, In every month you should divide your budget as I mentioned above:

Needs (50%): $5.000 per month

Wants (30%): $3.000 per month

Saving (20%): $2.000 per month

So, with the end up of the year, you will spend $60.000 on your needs, $36.000 on your wants, and $24.000 on saving part.

Please take into consideration that the saving part is not completely untouchable, because it's also made for emergency things that will happen outside of our control.

In the end, I hope you are learning even a few things from my article about saving money, and as I said this is just for saving money, not building a business that comes with more money, of course when I'm talking about business that means more risk and more stuff to calculate and deal with, that why I put a different article for that.

Thank you