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70/20/10 Budget Guide

70/20/10 Budget Guide

There is a common rule for budgeting hard earned money. This is the 70-20-10 rule. Depending on the explanation and inclusion on each parts, the main objective is to help and to guide you allocate your money wisely.

Let’s start with the 70%. This should be used in paying your monthly expenses such as food, clothing, utilities, bills and other things that you are paying regularly. Payment for shopping, new gadgets and even luxury vacation should be taken from this portion. In case you have excess of this portion, try to add it on your 20% part. Especially if you are single with less expenses.

As for the 20%, this should be allocated for your savings and investment. For most Filipinos, they only think of bank when they heard about these terms. Though bank is a good way to save money, it is not adviseable for investment. Due to the fact that at the end of year, you will end up losing money thru inflation. You can think of other investment vehicles like stocks, mutual funds, insurance, real estate or other related things. It doesn’t mean that you are obliged to make the 20% as fixed amount. If you have excess money from your 70%, it is then advisable for you to put it on this part of your budget. Investment can have a long term return. Thus, always make sure that you have enough money for 6 to 12 months expenses that you can use aside from the money that you have invested for long term.

Remaining 10% can vary base on each person. For some, they will use this as thites for their churches. While for some, they will allocate this amount to be given in various social causes. It can be for charity, a tuition fee for your sponsored child or even your help to anyone in need. As long as you spend it for the good and benefit of other people. However, as I have said, this vary from person to person. While it may work for, it doesn’t mean that you should also follow. Choose something that bests suits your needs and circumstances.

P.S. A year ago, I do not know anything about investment. Then I joined Truly Rich Club by Bo Sanchez. It was the best decision I ever made in my life. Brother Bo is a spiritual preacher and at the same time, financial literacy advocate whose purpose is to help people become rich in order to serve the LORD with the money that they have. He guided me along the way, explaining how I can manage my money and make it work hard for me. Now I’m investing in stocks and mutual funds and have a clear path for my future. Soon I’ll open UITF account as well. All are made possible by his guidance and teachings on every steps to become an investor. Being OFW isn’t forever, this is my EXIT PLAN. It’s amazing how his teachings change my life. I’m inviting you to join the club too, JOIN TRULY RICH CLUB. If you have any question, feel free to leave your comment below. CLICK HERE TO JOIN

About Richard Macalintal

Hi my name is Richard. I am a Registered Financial Services Consultant in Singapore. If you have any queries or you need help on your insurance policies and investment linked products, feel free to message me :-) We can have a cup of coffee while I do financial review and give advice with regards to your finances :-) Contact me thru email rlmacalintal(at)yahoo.com or SMS me +65 82235186. Disclosure: I am a Financial Consultant of AIA. The statements or opinions expressed on this site are my own and do not necessarily represent those of AIA.

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