"The former Harvard lawyer, bankruptcy expert and current Trump-botherer devised the nifty notion of spending 50pc of your net monthly income on needs, 30pc on wants and saving the remaining 20pc, in her book All Your Worth: The Ultimate Lifetime Money Plan, after her experience of her own parents struggling financially when her father lost his job."
"The answer lies in automation. Your bank is the link. They allow you set up free savings accounts, vaults, pockets or jars where you can send some of your cash on pay day. The answer lies, according to experts, in "paying yourself first". That means, by standing order or bank transfer, you arrange, every single month, for money to be scooped into a range of savings buckets which are named and purposed for specific things, in the three days following pay day."
The 50/30/20 rule prescribes allocating 50% of net monthly income to needs, 30% to wants, and 20% to savings. The guideline originated with Elizabeth Warren and grew from personal experience of parental financial struggle. The rule has gained renewed popularity through social media and influencers. The distinction between needs and wants can be blurred, making the rule challenging for some households. Automation and bank features like savings accounts, vaults, pockets or jars enable "paying yourself first" by scheduling standing orders or transfers shortly after pay day into named savings buckets for specific purposes.
Read at Irish Independent
Unable to calculate read time
Collection
[
|
...
]