I love shocking people with this simple fact.
You've heard of the 10% rule i.e. "Save 10% of your income first”.
Have you been doing that? You’re not alone. Almost everyone has heard of this rule. Yes most people can’t afford to do so, and of the few that can, none of them ever do.
Why? Because you missed the second half of the rule.
Yes you need to save 10% of your income. But, the key to life is Balance.
If you need to save 10% of your income, you need to blow another 10% of your income!
That’s the key. That’s why you’re not saving. You’re not setting aside money to spend!
If you don’t believe me, try it.
Next time when you execute your financial plan (I don’t call it a ‘budget’, too negative a word) try putting aside 5%, but blow another 5% on something you don’t really need (like eating out or something). I know this way you’re only saving half of “what you’re supposed to”, but it’s better to save 5% and feel good than it is to save 0% and feel guilty.
Trust me, it works a lot better than just saving 10% with no reward.
If you don’t have the 10% to save, save what you can. But remember to spend half of it. Spend it on a slurpee or 5 cent candy if that’s all you can afford.
The habit is more important than the amount.
Your money isn’t going to make you rich or financially secure, your habits are.
And if your habits tell you to save and not enjoy life, you’re either going to blow your money, or you’ll fill yourself with resentment.