Scott Pape: Welcome to the Barefoot Investor’s 60-60-6 challenges. Helping you get more money smart by the minute. Becoming a dad has been one of the most rewarding experiences of my life. But when two incomes become one and they have to feed three you need to make every dollar count. Now, careful planning will help stretch your hard-earned further.
So for your 60 second challenge, I want you to write a list of what it costs to keep your hey happy Monday happy Tuesday happy Wednesday not sure what day you guys are gonna watch this hopefully … family running each and every week. And I mean everything – mortgages, rent, food and bills. And ASIC’s MoneySmart budget planner can help you do this. You’ll need this for your next challenge. Now you know your numbers, you need to make them work for you. My 60-20-20 plan is the easiest way I know to manage your money, no matter how much moneyyou’ve got coming in. I want you to work on dividing your income into three parts -60 per cent safety, 20 per cent savings and 20 per cent splurge.
Now, switching from two incomes to one can be really dangerous if you keep spending the same amount. Safety means allocating 60 per cent of your take home pay to food, shelter and dog biscuits. 31 Contemporary Bedroom Decorating Ideas All the essentials. Make sure you check that the list you created in the last challenge equals no more than 60 per cent of your income. If it’s more than that, work on ways to scale it back. Next, I want you to work up to allocating 20 per cent of your hard-earned income into savings. If you start this before going down to one income you’ll have an awesome safety net forall those little unexpected costs that come along with family life.
We’ll look at how to kick-start your savings in the next challenge. Okay, so you’ve done the hard stuff, now for the fun… You are hereby directed to go outand blow 10 per cent of your money each week on stuff that makes you feel good. The other 10 per cent should go to longer-term splurges, like overseas trips or anythingthat’s going to cost more than a few week’s wages. Okay, so I know saving 20 per cent of your take home pay every week can be a really dauntinggoal, especially if you’re starting from scratch. But you have to start somewhere, so to kick off my plan I want you to spend the nextsix days doing whatever you can to scrape together just a few hundred bucks. And put it into a high-interest online savings account or what I like to call your ‘mojo account’.
Now, if you’re struggling to find your Mojo, try to think outside the box – find anothersource of income, sell some stuff online, or even have a good old-fashioned garage sale. Now, you’d be surprised at just how easily you can turn your unwanted stuff into cash, really fast. Now, your first few hundred bucks will help you build the momentum and pretty soon yoursavings will be snowballing. It will make you unstoppable. Use MoneySmart’s savings goals calculator to work out how fast you can reach your targetand how much interest you’ll make to top up your savings. Remember, when you have cash you’ve got choice- and that’s real safety for you and your family.