02 SETTING UP THE

SYSTEMS
HOW TO SET UP YOUR SYSTEMS SO THAT YOUR MONEY IS GOING
WHERE YOU NEED IT TO ON PAYDAY.
Set up your accounts so that this is automated in
the following order:

AUTOMATION
Let's see how.

Salary 5% 401k /PENSION

95%

Current/ Checking Roth IRA/

Savings 5% 5%
Account ISA

85%
Wedding 2%

Down Payment 2%
House

Vacation 1%

Miscellaneous
Credit Card Bills

Regular Bills that can be

put on a credit card Bills that can't be paid
(subscriptions) on Credit Cards
(like rent/ mortgage)
Day-to-day spending
 02 SETTING UP THE
SYSTEMS

Automating this and paying yourself first

removes any excuse you have in saving.
When you pay yourself first and treat
paying yourself as you would paying
any other bill, you’re mentally
establishing saving as a priority.

SPENDING RECOMMENDATION

50 / 30 / 20 Rule
50%-60%
FIXED COSTS
things like rent, utilities, and
repaying debt should make up
50% of your after-tax income

But, here’s the thing – the
justified spending is only
20%-30%
INVESTMENTS
things like your Roth IRA/ Pension and 401k/ISA
should be about 10% of your after-tax income and
another 10% should go towards your savings, big or
small – downpayment for a house, vacation or gifts.

after you’ve built up an

emergency fund. Life will
throw at you plenty of
unexpected, unpredictable
surprises. Be planned.
5%-20%
JUSTIFIED SPENDING
Things like dining out, drinking, and other
luxury spending should make up 30% of your
after-tax income.