Ways to Manage Your Personal Finances

Manage Your Personal Finances

 How To Manage Your Personal Finances?


Managing personal finances is a crucial skill that is often overlooked, especially as young people. There are so many social factors that can influence how we spend our money, from peer pressure to societal expectations. It is generally challenging to find a balance between enjoying the present and planning for the future, one that I am trying to figure out and with a continued effort to try and get it, it will make sense one day.

As a young person, I struggle with this balance, but I know that developing good habits with my finances is key to achieving my goals, because as a human our environments greatly influence how we behave. By understanding this, I found a system that I started using the 60-20-20 model, a percentage-based system that helps me allocate my income to different areas of my life, my first step towards building financial discipline – make it simple.

Manage Personal Finances: The 60-20-20 Model


The beauty of this system is that it is entirely customizable to fit your individual needs and goals. Personally, I allocate 60% of my income to saving, 20% to personal spending, and 20% to investments.

Saving 60%


The 60% that I save goes towards the costs of living as a student, such as rent, food, and other expenses that require future payments. By putting aside this money, I am able to plan for the future and avoid financial stress down the road, especially as an international student trying to support towards getting your education.

Spending 20%


The 20% that I allocate to personal spending allows me to enjoy the present and indulge in things that make me happy, from buying a the latest football boots, to that one hoodie or simply treating myself to a nice meal (my cooking is a work in-progress). It’s important to have some room for fun in your budget, and this system helps me achieve that while still saving for the future. The second step towards financial discipline – make it attractive.

Investing 20%


The remaining 20% goes towards my investments, which includes funding the initiatives that I have started – The Young Eye Initiative (Young eye International Podcast and Young Eye Foundation). It takes a lot of long-term planning, vision and honestly a degree of madness – haha, but by studying the market and staying consistency, I believe that these investments have the potential to become self-sufficient.

A great blog on developing project budgets: How to develop a Project budget?

Of course, it’s one thing to have a breakdown of how to allocate your income, and it’s another thing entirely to actually put it into practice. In future blog posts, I will share my tips and tricks for making this system work for me and how you can implement it into your own life. The last step to obtaining financial discipline – make it obvious, breaking down this model attempts to do that.

In this blog I spoke to 3 ways to achieve financial discipline not only in this model, but in any aspect of your life, make your system simple, make it attractive and make it obvious, this was inspired by James Clear book, Atomic Habits.

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