How to Save your Money using the 70 20 10 Money Rule

Everyone loves to travel, either it be local of outside the country. As for me, I love local travelling. Travelling needs requires money. Who on earth would want to travel without any money in their pocket? I'm sure no one would like to be in a place without bringing some souvenirs.

I was scrolling my Facebook feeds I saw an image with a quote, “Once a year go somewhere you’ve never been before.” I was quite happy with that thought so I make sure that this year it would happen – that I would be travelling other part of our province that I never have visited before.

There I was thinking of travelling but there was something holding me back – money. I could not travel without any money. It’s not free. I would spend for sure since I want to travel for my own good. So I researched ways on how to save money and learned about 70 – 20 -10 money rule. I know 70 – 20 -10 principle more of learning method but I never think that it would be applied to financial aspect.

70-20-10 principle is the most basic computation when it comes to your finances but it may vary depending on your lifestyle. As for me, let’s start with the basic.

70 percent for living expenses. It is said to be that 70 percent from your salary should be allocated on your day to day expenses like transportation allowance, grocery, food and snacks, rents. 70 percent should cover all your basic necessity until you receive your next salary.

20 percent for Savings. Now savings is ideally divided into 3 parts but this is optional.

10 percent for retirement or insurance. Other than your employment contribution there are other firms that you may want to enroll like health insurance, life insurance or travel insurance. You may find insurance useful during travelling specially in covering medical expenses.

5 percent for emergencies. Emergency funds depends on how it is defined but ideally when we talk about emergency funds it should cover your living for the next three to six months.

5 percent for specific goals. Specific goals may differ amongst every one of us. It may either be for your wedding, car, and house but in my case it would be travel. 5 percent would be enough to cover a travel per year.

10 percent for Debt. Debt may be optional but in my case I have a cellular plan so I would consider as debt.

Again it may vary depending in your lifestyle and how dedicated you would be. As for me, I would consider the basic computation as my initial basis so I could travel this coming month.

Effective Way in Saving Money

There are many ways in saving your money. You can have a multiple bank account to individually group on how your money should be placed or you may prefer to have a piggy bank at your home and there are many videos in youtube that uploaders share their own experience on how they save money.

If you think that you have tried everything and failed you can try an old school method that many are not even aware of. Let me hear your reply by leaving a comment below.

Here's what you will need.

1. Wallet

If you currently have your own wallet right now it's fine but I would suggest to have a thin wallet just like what I have. This type of wallet would lessen your worries like how many money you still have and if you have two or more credit card. With a thin wallet you would just bring limited items if you are just around the city.

2. Money

Again, you don't have to bring huge amount of money in your wallet. Just bring you average expenses then add an additional cash for emergency like unexpected meeting or when your car run out of fuel.

If you have a credit card with you, it's still ok but I suggest that it would be your last option in paying your bills. Simple as that.

Piggy / Coin Bank

Don't be embarrassed with your cute Piggy Bank or Coin Bank. It will help you a lot. After a long day outside, now is the time to count your money and put it in your Piggy Bank or Coin Bank.

Money Tracker

Saving money does not end there, you also have to keep track of your savings. It would be better to have your own android app to keep track of those savings. There are a lot of apps like Spendee, Fiancius, Money Lover - Money Manager but I prefer to have it detailed so I chose Money Manager Ex.

Assistant / Money Holder

This is optional but if you are not yet in control of yourself. Have someone to hold your money and only give you a budget for a day but if you could do it by yourself it would be better.

See below the breakdown of how my expenses was cut short without difficulty.

DATE	AMOUNT			DESCRIPTION
	INCOME	EXPENSES	RUN. BAL.
20-Jul-15	100	55	45	Lunch and Snack
21-Jul-15	145	49	96	Lunch
22-Jul-15	196	55	141	Lunch and Snack
23-Jul-15	241	47	194	Lunch
24-Jul-15	294	60	234	Lunch and Snack
25-Jul-15	334	245	89	Lunch; Buy Wallet
27-Jul-15	189	145	44	Lunch; Refuel
28-Jul-15	144	45	99	Lunch
29-Jul-15	199	54	145	Lunch and Snack
30-Jul-15	245	45	200	Lunch
31-Jul-15	300	82	218	Lunch; Unexpected Meeting

Please note that budget for Breakfast and Dinner is not yet included since I am still living with my parents.