Automatically Save 20 Percent of Your Monthly Income
A part of all you earn is yours to keep, and if you cannot save money,
the seeds of greatness are not in you. — W. Clement Stone
Do you know the common habit of a permanently poor person?
After receiving his salary, he pays his bills right away. Wrong move.
Here’s what rich people (and potentially-rich people) do: After receiving their salary, they save first—and then pay their bills second.
I recommend that you give your first 10 percent to God (more on this later), give your next 20 percent for yourself as your retirement fund, and live on 70 percent of your income.
I know what you’re thinking: “Bo, are you nuts? How can I live on 70 percent? I now live on 110 percent of my income!”
Here’s my answer: If there’s a will, there’s a way. If you really want something bad enough, nothing is impossible. Do you want to be part of that two percent of people above 65 who are financially independent? Then do it. (If you want more ideas on how to do this, you can read my two previous books, Simplify and Live the Good Life.
Create Abundance. Go to your nearest bookstore or log on to www.bosanchez.ph and click on books and magazines.)
Besides, in the later chapters, I’ll teach you how to increase your income, so living on 70 percent of your income will be easy.
But right now, I want you to sit down and write down how much 20 percent of your income is. Make it automatic. Write down postdated checks to yourself if you have to. Month after month, make it happen.
Every time you receive your salary, get 20 percent and put it into your retirement fund.
My idea of saving 20 percent of your monthly income comes from the Bible. When Joseph was overseer of Egypt, he prepared for famine by saving a “fifth of the produce.” So when famine came, Egypt was the only country that had food—and the peoples of other nations came to them to buy grain.
Let Pharaoh proceed to appoint overseers over the land, and take the fifth part of the produce of the land of Egypt during the seven plenteous years. And let them gather all the food of these good years that are coming, and lay up grain under the authority of Pharaoh for food in the cities, and let them keep it. That food shall be a reserve for the land against the seven years of famine which are to befall the land of Egypt, so that the land may not perish through the famine.
— Genesis 41:34-36
Famine will always happen.
How do you protect yourself from famine—which would be the future decades of your life when you’re no longer earning?
By saving 20 percent of your income now while you are earning.
In the next chapter, I’ll explain why doing this early will create a huge retirement fund that will bless your life.
Automatically save 20 percent of your monthly income.
Famine will always come. So prepare for it.
Author: Bo Sanchez
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