Please read the disclaimer before using any of the advice on this website.
I’d like to introduce you to the Power of Three system of financial planning that I developed to plan my financial health. And no, this is not something out of the “Charmed” TV series. Well, had to clear that up, since that’s what mostly turned up when I did an image search with the title of this blog.
This blog actually is the first in a series of posts that I intend to write for documenting my thrifty, penny-pinching ways of money management. Now, this doesn’t mean that I miss out on the finer things that life may have to offer for my means of income or wealth. Rather, just the ways in which I plan to enjoy them.
The long and short of it
The series will focus on leveraging the system for an average salaried individual. The Power of Three focuses primarily on 3 aspects of outflow from an individual’s income per month.
- Savings per month (Have to save)
- Fixed Expenses per month (Need to spend)
- Other Expenditure per month (Try to spend)
These and only these factors/buckets are used to determine the whole spending pattern of the individual for the entire month. The outflow into each of these branches is divided equally from the income and there are only three main categories to take care of no matter what lifestyle or stage of life the person is in. Since there are only 3 buckets to take care of throughout your life, the system becomes very simple to understand and to sustain discipline once you start practicing it.
The upcoming articles following this introduction will contain the details of the process of planning with these few factors in a particular manner. These articles will also dwell on how one can use them to have a slightly more stable and predictable financial future, month after month.