As you have seen, I have been posting about my participation during the Millionaire Mind Intensive (MMI) in Kuala Lumpur.
One of the habits of millionaire is how to manage money. To manage money it needs determination. We are told to distribute our money in 6 jars. In this posting I am going to share what I can still remember about the jar and I had already taken my first step to buy the jar.
Jar 1 – Financial Freedom Account (FFA)- Put aside 10% of your income in this jar. Whatever money in this jar is to spearhead your Financial Freedom. From this jar spend only the profit and NOT the capital. The capital can be increased from time to time so that the profit can increase too.
Jar 2 – Long Term Saving For Spending (LTSS) Put 10% in this jar too. Money in this jar is for your spending. It is also advisable to separate this jar into 5% each. The first jar is for your major expenses such as your car, holidays etc. The second jar is for you to pay your debt, children’s education etc. Label the jar accordingly and if needed write the purpose of the respective jar.
Jar 3 – Education Jar (EDU) 10%. This education means its your own education for your self improvement. Use the funds in this jar to attend seminars, conferences, workshops and classes to improve your skills.
Jar 4 – Necessity Jar (NEC) 55% Funds in this jar is what makes you and your family survive daily. Use it to pay your rent, mortgages, food and your daily needs.
Jar 5 – Play Jar (PLAY) 10% This jar keeps your needs such as your extra clothing, toys, entertainment, eating out with your family etc.
Jar 6 – Give Jar (GIVE) 5% As a rule of nature whatever you give to people, you will get back more than what you gave. Use this jar for your donations, rewards etc.
Six Jar to manage your money
Did I tell you 6 jar and its only 5 in the picture? Well, the Necessity Jar is missing. Actually that jar is my bank account. I better leave the most important part of my earning in the bank and when I need to spend, I will withdraw or use my debit card. I am NOT using a credit card anymore to avoid overspending.