6 Jars of Wealth Creation

“You Either Master Money. Or, On Some Level Money Masters You!!”

Yes, that’s true! As an entrepreneur, you must know how to use or invest your money rather than saving your money. Because one right spend is worth as compared to thousands of wrong ones!

Money has the ultimate power to either make your dreams or break your dreams. But still, you need to understand that money helps you in running your life better. So, don’t let money run your life!

T. Harv Eker shares Money Jar System that can help people to improve their relationship with money for of-course something better. He shares a strategy that helps us stop procrastinating and start learning how to manage our money the best way!

Let’s learn about 6 jars of wealth that can further help in streamlining your regular expenses, sudden expenses, long-term savings or investments, leisure expenses and much more! Moreover, it will help you with financial independence along with a good present and better future.

So, here we go

Wealth Jar #1: Necessities – 55%

• The first jar, the most dominant jar is your living jar known as necessities.
• Keep almost 55% of your money reserved for your daily necessities which include food, payments, bills, gas, insurance, groceries and others.
• Keep an eye on your daily expenses because if you’re using more than 55% of your income on this, then it’s time to cut down your expenses.
• Find alternate methods to satiate your necessities and if possible best is to keep your expenses around 50% or lesser.
• Now it’s on you, how to manage your money. If you aren’t able to lessen your daily needs, find different ways to earn more, especially passive income!

Wealth Jar #2: Financial Freedom – 10%

• Next comes the freedom jar that gives you financial freedom.
• Yes, this is the jar where you can reserve your 10% of income with a promise of NEVER spending money from this jar. This is the jar that will only grow bigger and stronger throughout.
• With this money, you can make profitable investments that guarantee you with big ROI. It may include- real estate, business or the stock market.
• Over time, these can be the best sources of passive income and they will create enough money even when you are not working.
• The more amount you reserve in this Financial Freedom Account, the more you will have in the future!

Wealth Jar #3: Long Term Savings – 10%

• Next jar, the third one is the Long Term Savings jar where you must put 10% of your money.
• This jar keeps your future expenses in mind and lets you have enough at the time when you want to utilize it.
• If you have plans to make your child study abroad or you want to plan a secure and financially settled retirement life, all you can do with this jar.
• Monthly savings from now can surely add up to a big amount later.
• This jar simply means- save now and spend or enjoy later!

Wealth Jar #4: Education – 10%

• The next jar is meant for Education which is again the most important one.
• Education is something that everyone needs to have, so reserve 10% of your income in this jar.
• The money is meant for growing and updating yourself with recent technology and trends over time.
• Enrole yourself in any course or workshop or just enhance your knowledge and skills for your betterment.
• It’s said that- “If you are not updated, you are outdated” and this is true. So keep moving forward!

Wealth Jar #5: Play – 10%

• The fifth jar is the Play jar which lets you improve your standard of living as your income increases.
• Keep 10% of your monthly income reserved for a fancy dinner or just spending a beautiful weekend with your family, as this is not something you do very often.
• Give yourself a little reward too after working so hard the entire month. As it is said that treating yourself too harshly can decline your productivity and happiness.
• So the best is to reserve a wonderful, quality time to be spent with your family, friends as well as near and dear ones!

Wealth Jar #6: Give – 5%

• The sixth and final jar is all about giving and serving others.
• Yes, you can reserve at least little as 5% of your income for helping others through donations or social service after managing your own financial base.
• Donate and help the people in need while making this world a better place!

What’s your take on this? Do you too think this is how our hard-earned money should be managed? Or do you have something that can be added to this list? Do let us know.

Final words:

Earning money is not a big deal, but managing it the right way is the most important thing. Always keep your finances updated and make the most favourable investments that will end up being the profitable ones.