2 ways to plan your finances
Method 1: T. Harv Eker’s 6 jars (accounts)
- Account 1: Investment – 10% of income
This account is only for investment, no spending. The purpose is to let money make money – Invest in coins, stocks… use money here.
- Account 2: Daily consumption – 55% of income
This account is for daily expenses. Rent, gas, diapers, milk, meat, fish… use money here. If it’s not enough, earn more, no taking from other accounts. - Account 3: Long-term consumption – 10% of income
Buy expensive things like iPhone, house, car, send your children to study abroad… use money here. To buy a 20 million iPhone, you must earn 200 million before buying it. - Account 4: Study – 10% of income. Study is a part of your career. Many people think that after finishing high school and college, they stop => This type of person will be ruined for the rest of their lives without understanding why (if you don’t study, you won’t understand, if you understand, you won’t be ruined). Studying is reinvesting in the brain – the thing that controls your hands, feet, and mouth to make money. Investing 10% in it will make you progress. Go to school and get this money
- Account 5: Play – 10% of income. We grow up with punishment – Bad grades => punishment, doing something wrong => punishment, failure => punishment… and the sum of all the times we are punished creates who we are. We do things because we are afraid of being punished, when we grow up we are afraid of being laughed at… and this fear pushes us to… drag ourselves along the path of our careers. Many people later, when no one punishes them anymore, they punish themselves when they fail, suffer, complain => COWARD. Now we have to be different => Reward ourselves with 10% of our income. When it’s all gone, that’s it. This account is the opposite of account 1. It must be spent at the end of each month.
- Account 6: Giving – 5%. Seeing that we are meaningful to the community is a huge human need. We often experience feelings of depression, loss, disorientation… because we feel useless. Use this 5% to give. It doesn’t have to be charity, it can be buying gifts for friends, siblings, employees, colleagues… not for them but to see that we are meaningful to the people around us.
Whenever I’m bored, I just give away money (if I don’t have money, I take a bag and go to the alley to pick up trash for the whole neighborhood). I immediately feel that my life has meaning => The joy of living returns.
The rule of this method is to DIVIDE MONEY EVERYDAY => If I don’t have money to divide, I divide the zeros to feel HUMBLE, to ask myself WHAT THE HELL DID I DO TODAY TO HAVE TO DIVIDE ALL THE ZEROS?
If I’m HUMBLE, I won’t be lazy tomorrow, I won’t go to coffee and gossip, or worry about other people’s business anymore. I won’t sit around saying this guy is stupid, that girl is disgusting… But I will focus on making money, I will go sell things and feel proud because selling things is more glorious than dividing zeros into an account.
Tony Robbins’ Method 2 (This method is for those who earn about 50,000 USD per month or more)
50% of income is used for consumption activities, including all the items as in Method 1 above, EXCEPT INVESTMENT.
Long-term consumption, Daily consumption, Learning, Eating out, Giving
The remaining 50% of income is used for investment, divided into 3 items:
First 30% – Venture investment: Coin, ICO, Lending, stock surfing, 10-profit-1 investment deals, use this item. If you lose, that’s it, no one will die, no one will have to curse anyone. 10 deaths, 1 profit, life is already a breeze.
Next 30% – Business investment: Open a company, contribute capital, import goods, trade… use this item. This type of investment is risky but low, rarely dies (Of course, you have to LEARN to not die, if you don’t learn, you will die wherever you touch and you won’t even know why you died)
The remaining 40% – Long-term investment: Buy land, bluechip stocks, buy gold to store… This investment has extremely low profits but never loses, super sure. This can be considered as savings…
Those who have low income, still lack money for daily needs, use method 1
Those who have high income, money showing signs of surplus for daily needs, use method 2
Forget the saying “High risk, high profit” – Risk only happens to stupid people.
A motorbike taxi driver took 100 million VND to play the stock market – The death rate is 99.9% = Too risky
An investment expert like Warren Buffet’s disciple took 100 million USD to play the stock market The survival rate is 99.9% = No risk at all.
RISK ONLY HAPPENS TO FOOLS WHO LACK (EXCLUDE) KNOWLEDGE
You have to learn everything – you have to learn marketing, you have to learn sales, you have to learn business, you have to learn investing, you have to learn cursing. Remember?
Source: @Nguyen Vinh Cuong
