50/30/20 Budget Rule
Allocate your income to these buckets:
• Basic Utilities
• Debt payments
• Emergency fund
The Rule of 72
Get excited about saving.
Use the Rule of 72 to quickly calculate how many years it will take to double your money.
(Divide 72 by the interest rate)
• 8% investment return = Double your money every 9 yrs
1% Rule for Impulse Buys
Use the 1% Rule to curb impulse buys.
If the item is over 1% of your annual gross income, wait 3 days.
If you still want the item after 3 days, get it.
Why this works:
You’ll often realize you don’t actually want/need that thing.
401(k) Match Rule
Many employers will match part of the money you put into retirement.
So maximize your 401(k) contribution—
Up to the highest employer match offered.
This is free money.
3X Emergency Fund Rule
Keep 3-6X your monthly income in an emergency fund.
When a rainy day comes, you’ll weather that storm.
(I learned this rule from my friend, @AccentInvesting.)
The Rule of Automation
Defaults are powerful because people are lazy.
So make savings your default by automating it.
I highly recommend the book “I Will Teach You to Be Rich” @ramit
• Save and invest money before you ever see it
• Create an automated money system
Item in, Item Out Rule
If you purchase one item, then donate, toss, or sell another.
Minimalism is a dual discipline:
Manage both inbound and outbound possessions to enjoy equilibrium.
TL;DR Money Saving Tips
1. 50/30/20 Rule
2. The Rule of 72
3. 1% Rule for Impulse Buys
4. 401(k) Rule
5. 3X Emergency Fund Rule
6. The Rule of Automation
7. Item in, Item Out Rule