Budgeting, Money Mindset, Personal Finance

You Don’t Need to Be Rich to Be Financially Stable

Hello friends,

Today I’d love to share with you one of my biggest money beliefs: that you don’t need to be rich to be financially stable.

Shortly after deciding to write this, I realised that being ‘financially stable’ is a very personal thing, and means different things to different people. So I asked friends, both in person and on Instagram: what does being financially stable mean to you?

The answers I got were fascinating:

Whereas to the people I asked in person, it was more or less “Not living paycheck to paycheck.”

What’s my answer? For me, I would say that I feel financially stable now, but that I sure didn’t before. But whyWhat has changed? Personally, I still look forward to payday and save up for big wants & needs (eg. diligently saving 40% of my income for our wedding last year; saving up for a new car & laptop this year because they’re both old).

And it comes down to this: I don’t lose sleep over money. When it comes to finances, I’m grateful to have peace of mind and not to worry much. Of course, it’s not that I can afford anything my heart desires, but that if something comes up – a goal, a dream, a passion I want to pursue – I feel confident knowing that it is achievable. 

So what makes me feel financially stable now? If my definition is not losing sleep over money, what has changed to allow me not to worry and stress about it anymore? After all, I’ve had my financial ups and downs. Working 3 jobs at 21? Up. Moving to a new city on my own? Down. Landing my first corporate job? Up. Quitting a toxic job and spending the next year restoring my mental health and doing volunteer work? Down.

Here’s why I believe that you can achieve financial stability, whether or not you consider yourself ‘rich’:

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Budgeting, Money Mindset, Personal Finance

How to Live on 80% of Your Income

When it comes to budgeting your money, it can be confusing to know where to start. How much should you be spending – and what should you be spending on? How much is ‘normal’ to spend on everything in your life, from your rent or mortgage, your car, entertainment and eating out?

If you have no idea where to start, or would just like to refresh your money mindset and give your budget a makeover, here’s a super simple budgeting rule: the 50/30/20 rule.

If you have a 50/30/20 budget, that means that:

50% of your net income goes towards needs;

30% of your net income goes towards wants; and

20% of your net income goes towards your financial goals, like paying off debt or buffing up your savings.

Let’s say that I bring home $1500 every fortnight. Ideally, my budget would look like this:

$750 (50%) for my needs;

$450 (30%) for my wants; and

$300 (20%) for my financial goals

So what does this mean? Because 50% goes towards needs and 30% goes towards wants, that means that 80% of your budget is allocated, leaving you with 20% to grow in your personal finance goals. Of course, if you can increase that 20% to 30%, 40% or more, even better! In an ideal world, right?

What it means for you is that you need to learn to live on 80% of your income. Here’s how I did it, and you can too!

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