The first and foremost step to becoming financially stable and independent is always managing money well. However, it is not so simple to achieve the term “great money manager”, in fact, handling money flow is usually witnessed to be stressful for most people. Luckily, the solution for this problem was found and it is no far from 6 Jars Money Management System, this article is even more valuable for the secret lying below! Let’s discover!
6 Jars Money Management Method In A Brief
In the well-known “Secrets Of The Millionaire Mind”, T.Harv Eker has introduced this magical 6 Jars System which leads you to your financial freedom in the fastest way. It is also a relatively simple and friendly concept that everyone can understand and apply, that’s why it’s such a popular way of controlling money flow nowadays.
This system requires you to divide your money into six different accounts or jars containing certain percentages of your income. Specifically, they are Necessary Accounts (55%), Financial Freedom Account (10%), Long-term Savings for Spending Account (10%), Education Account (10%), Play Account (10%), and Giving Account (5%). Each of these jars is essential and you should put your money into them as the following percentage, regardless of how much you earn. Over time, you will watch them continue to grow on your journey to financial freedom.
For deeper understandings of what is in each jar and the purposes of each account, you can go to my previous article 6 Jars System: The Secret To Build A Millionaire Mindset.
Frequently Asked Questions (FAQs)
1. What Do You Do If Your Income Is Not Enough To Split It?
There are myriad statements or comments saying that “I would love to have this money management habit, but I cannot do it! I don’t have enough money coming in to split it“ and “My expenses are too high, there is no way I can afford to split my money into different accounts“.
If you also have the thoughts like those, then you are totally wrong. The matter doesn’t lie in the amount of your finance, it may require much time to save, but a small monthly contribution can go a long way! As well, the main point here is getting you to follow this method and create a discipline rather than not doing it.
2. What if my NECESSITIES requires more than 55% of my income?
Again, I emphasize this term “Habit is more important than amount” for you to remember.
In fact, people tend to question this matter on the way to start with 6-Jar System. It’s important to know that the percentages given are the most suitable based on researched data but not standard, you can flexibly alter the proportions until they suit you the best. Consequently, if you can’t follow the suggested idea, just take an amount you can manage and start there. Nevertheless, as said before, we believe the habit of managing your finance is far more essential than the amount.
Besides, we know our customers, so we with all our compassion have developed an appliance that helps you solve every smallest problem with your money, the 6 JARS MONEY MANAGEMENT. Why don’t you try it out and receive benefits from it?
3. What should I do if I have a lot of debt to repay?
The problem is much simpler to handle than you thought! No worry, you still manage your money as usual as you have the LTS jar (Long-term Savings for Spending Account) to deal with your debt, however, always remember to pay the minimum.
If your EMI is so high or credit card outstanding amount is so high, then utilize your earnings in the following bucket in the order from the LTS account to Play Jar and the last one is Give jar. It’s more important that you keet the habit of a good money manager, once you focus on paying your debt than practicing that habit, you are likely to repeat the same debt pattern.
To create the habit first and pay down your liabilities, you may need help from our latest application 6 JARS MONEY MANAGEMENT!
4. If I earn passive income, how should I use this system?
If that is the only source of your earnings, then you can still slit it up in the same percentages as suggested above. However, if it’s just the added income supporting your regular income, then in case you want to accelerate the speed to reach your financial freedom, then you can put all of the passive one into the FFA jar (Financial Freedom Account). That’s until you hit your financial freedom number and are ready to live fully off of the passive income.
Decide Right Now: Are you going to get 6 jars and start managing your money today?
Throughout my article, you must realize the importance of the concept. To make it easier and clear for you who are finding a way to manage money, we have released the 6 JARS MONEY MANAGEMENT application with the latest utilities and the most simple way to approach. Download here and try it out. Trust the process!