Money

Flow

  1. Income & outcome

    1. Never pay yourself 100% of your income.
    2. The next time you receive an unexpected monetary gift or bonus, such as a payrise, save 50 percent and spend the rest in whichever way you want. This way, you won’t get used to spending more than you can afford.
    3. Conscious spending plan
      1. 60 percent on fixed costs (rent, utilities, debt)
      2. 10 percent on investments (401 (k), Roth IRA)
      3. 10 percent on savings (vacations, gifts, unexpected expenses)
      4. 20 percent on guilt-free spending

Budgeting

  1. Purchasing

    1. Buying new-used items
      1. Understanding markets for used goods.
      2. Leveraging Craigslist or eBay to save money.
      3. Maintain a spreadsheet of items you own.
    2. Buy only the home or apartment you need, not the one you can afford.
  2. Loans

  3. Investing

    1. How much you should have in your 401(k)
      1. Age 30: 1x Salary
      2. Age 35: 2x Salary
      3. Age 40: 3x Salary
      4. Age 45: 4x Salary
      5. Age 50: 6x Salary
      6. Age 55: 7x Salary
      7. Age 60: 8x Salary
      8. Age 67: 10x Salary
    2. Average of what people have in their 401(k)
      1. Age <25: $4k
      2. Age 25-34: $22k
      3. Age 35-44: $60k
      4. Age 45-54: $116k
      5. Age 55-64: $117k
      6. Age >65: $200k

Mindset

  1. Money is a choice multiplier.
  2. Leverage other people’s money.

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