Wednesday Wisdom

Take care of your finances

In the insta-famous culture we live in you have to have the most and the most expensive  things money can buy. Its not enough to have a new BENZ you have to have a BMW as well, and be on your way to a Ferrari. You cant just have a significant other either. Your significant other most be the as “popping” as you. In addition to your significant other you have to have a laundry list if “options” you can call at the drop of a dime to do as you ask them too.

Pay your debts as soon as you can. The more you owe on a higher interest rate the more you have to pay eventually . Its east to dig yourself into a hole with credit cards and pay advance loans. trying to impress people by living a lifestyle you cant readily afford . Its hard going through life and feeling like you are less than but with the right financial disciple you can live the life you want plus more. You have to pay your bills on time. You cant over spend on leisure activities or be wasteful.

Find someone that is on the same path as you mentally when it comes to money management. You and your significant other should be on the same page as far as saving for the future and making sure your finances are in order. My wife and I are working on building our own personal savings and a joint savings. Make sure you are in a relationship with someone that is willing to sacrifice as much as you so the both of you can win.

50/20/30 Broken Down

The 50/20/30 guideline can be easy to follow because it splits everything into three main categories:

1. Fixed Costs
These are bills and expenses that don’t vary much from month to month, like rent or mortgage payments, utilities and car payments. We also include subscriptions, such as gym memberships and Netflix accounts, in fixed costs because you’re committed to paying them on a monthly basis.

When it comes to fixed costs, we generally suggest that you aim to keep your monthly total no more than 50% of your take-home pay.

2. Financial Goals
Consider putting at least 20% of your take-home pay toward important payments or contributions that will help you secure your financial foundation. These are things like paying down credit card debt, saving for retirement and building an emergency fund. But your financial goals can also include larger savings priorities like a down payment on a new home.

3. Flexible Spending
Finally, consider budgeting no more than 30% of your take-home pay toward flexible spending. These are day-to-day expenses that can vary from month to month, like eating out, groceries, shopping, hobbies, entertainment, or gas.

We include groceries in flexible spending because even though food is a necessity in your budget, how you spend on food can vary. Some weeks you might eat out more, while others you may buy more groceries to cook at home.

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