Is it crazy to set aside 25% of your income for the fun things in life? Many financial advisers would give that a big, fat ‘yes’. But Sarah Riegelhuth has a rule of thumb which, she says, might not always be successful – you have to work towards a fine balance, but if done right you can have a quarter of whatever money is coming in to spend on the fun side of life.
And the longer you follow her 50/25/25 Rule of Saving, the easier it gets, giving you even more to spend on yourself.
So what is this rule?
Sarah advises that you spend 50% of your jncome on the things you NEED in life, 25% of your income on the things you WANT, and save 25% of your income to invest in your future – which means having more money for the fun stuff further down the track.
Sounds like a good plan to us Sarah!
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