The “PINOY MILLIONAIRE GAME PLAN” To Win The Money Game
There is a saying that “no matter how much you earn, if you don’t keep anything, nothing will change in your life.” This is why you need to devise a game plan, a formula how to allocate your earnings.
“The wise have wealth and luxury, but fools spend whatever they get.”
I learned about the 70-10-10-10 formula from Jim Rohn. I made it 10-10-10-70 so that it will correspond with my philosophy as discussed in my previous article. I will call it “The Pinoy Millionaire Game Plan.” Following this game plan, you are managing the money that is coming to your household every month.
Managing and budgeting money promote and allow you to “spend it all” without feeling guilty. Let me explain further about the Pinoy Millionaire Game Plan.
The idea is like having a team of many players. Your aim is to win the game – the money game. If you arrived at the point where you can live on passive investment income (even without working), then you’ve won the game.
Managing and budgeting money promote and allow you to “spend it all” without feeling guilty.
But to win the game, your players should play their part. Every cents should be spent according to its purpose.
THE FIRST TEN – GIVING AND SHARING
The first 10% of all my earnings is set aside to be spent for giving and sharing. This amount will be set aside for serving my God – for offerings, to give back from the blessings I received. God wants a cheerful giver! A part of this allocation will go to charities as well.
This is your equalizer, the coach or something alike.
THE SECOND TEN: PASSIVE CAPITAL
The next 10% will be spent for building my financial freedom fund or money machine. This is the ball handler, the game orchestrator, the offensive player who will make the score to win the game.
This allocation is VERY IMPORTANT as this will be used to build my wealth to win the money game and gain financial freedom. Once this allocation is put into the game field, they should not be taken out at all cost. They will continue to play the game until I gain financial freedom.
This is an expense “NOW” to build the required lump sum that will provide my family in the “FUTURE” an income from my investments. The interest alone should be big enough to be able to support our lifestyle even without working again if we choose to. This is the golden goose; and the golden goose should not be killed and butchered. This golden goose will then pass on as inheritance to our children and grandchildren to change our family’s destiny.
THE THIRD TEN: ACTIVE CAPITAL
The next 10% will be spent for my further education in specific knowledge in my field of interest. Learning is the key to everything.
Also from this allocation, I will slowly pay off any debts and build my Emergency Fund at the same time. When all debts were written off and the Emergency Fund is complete (3-6 months of expenses), I will then use this allocation to support my part time passive business to generate more income.
THE FOURTH PART (70): LIFESTYLE
The remaining 70% for lifestyle will be divided into 60% and 10%. The 60% is for paying the rent or pay mortgage for a warm shelter, insurance coverage, the food to eat, clothes to wear, for pleasure and enjoyment, etc.
The 10% of this allocation will go to a long term savings for spending intended for big ticket items like buying a car, family vacation, sail a cruise, attending high ticket seminars of Tony Robbins and the like, and other lifestyle expenses.
Following this Game Plan, you are assured of moving forward to your goal – to win the money game. Remember, the most important here is the habit of managing your money to replace your old habit of letting money manage you. If you cannot follow the 10-10-10-70 allocation right now, make adjustments according your situation. You can make it as 1-1-1-97 if most of your income goes to your expenses. Doing so will start your new habit of managing your money rather than money managing you.
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Here’s to your success!