Things Learned From…
Ramit Sethi — A Conscious Spending Plan
Following the basic guidelines, you’ll make sure you’re saving enough money each month while having money left over to spend on the things you love — guilt-free.
The Conscious Spending Plan has 4 major buckets where your money goes:
Fixed Costs (50-60% take-home pay, max)
This bucket has any basic expense that any ordinary person would use to live, like mortgage, utilities, car payment, groceries, cell phone, debt payments.
Investments (at least 10% take-home pay)
This bucket includes any long-term investment, like a 401(k), Roth IRA, or other similar investment accounts.
Savings (at least 5-10% take-home pay)
This bucket includes short-term, mid-term, and longer-term savings goals for things like holiday gifts, vacations, house down payment, and emergency savings.
Guilt-Free Spending (20-35% take-home pay)
This bucket is what you have left over for guilt-free fun money, for things like personal training sessions, meal prep services, entertainment, Ubers/Lyfts, etc.
Don’t get stuck thinking too hard about what goes where or if your numbers are exact. Get close estimates, implement your plan, and adjust as needed.
h/t Pump Club newsletter
Thanks for reading! Hope you have an awesome day.
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