Before we go any further, I have to say I am no financial expert. What I am sharing is from a wise man called Jim Rohn :).
He said this years ago and I think it makes perfect sense. A quick snapshot of an ideal way to spend your money:
- Don’t spend more than 70% of what you earn
- Spend 10% on charity
- Spend 10% for investing on capital hoping to make a profit
- Spend remaining 10% to invest in something that actually makes profit like FD etc.
And then he says another wise thing – know how you would like to spend your money when you get more of it. Some of us know how we are spending our current money. Some of us might not be fully aware of that too. Two steps ahead is knowing how might you spend your money when you have 1 million, 10 million. Interesting thought. If you think about it – we might already be feeling sufficient with what we have. Or we know how to spend the money we have. So, we don’t bother thinking further. And that’s where it all stops!