I don’t know about you, but when I got my first paycheck some four years back, all hell broke loose.
Almost-daily happy hour drinks? $30 lunch sets and regular taxi rides? All apparently acceptable to my younger self.
TL;DR: I Didn’t Consider Saving Any Part Of My Salary
And why should I? The millennial in me demanded I reward myself for my hard work. As it turns out, the folks were right: saving really should start from your first paycheck.
How To Allocate Your Monthly Salary
It’s not as hard to save as you might think.
You can start with something as simple as the 50/30/20 Allocation Rule.
Here’s how you can use it to allocate your salary, as told through pictures. Enjoy!
Note: These numbers are based on a Savings Account interest rate of 1.8% and Wealth Account returns of 6.3% (based on the 3-year Dollar Cost Average Returns with STI ETF.)
Some Pointers About Salary Allocation
The above-illustrated figures assume you don’t get your Annual Wage Supplement or annual bonuses – which is highly unlikely.
Here’s a breakdown of how we calculated $25,162:
One thing to note: the 50/30/20 Salary Allocation Rule is more a guide than a rigid framework.
The hardest part’s actually getting started – but once you’ve gotten into the groove of things, it takes minimal effort.
I should know; I put the pro in procrastinator.
The key is to start with it, then gradually adjust this ratio to suit your needs.
And if your struggle’s keeping track of your expenses, the Seedly app‘ll be right up your alley:
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