As soon as we hit college age, we get bombarded with messages about smart money skills.
Many university courses and clubs talk about smart money management and there are many, companies and finance-tracking apps out there to help us all keep tabs of our money. Like calorie-counters, they help us get down to the nitty gritty details about where our money goes.
For budgeting our money, among the best advice out there is the 50/20/30 rule. Simply put, we should divide out expenses into three categories:
- Essentials: house, car, heating and electicity, groceries, insurance.
- Future: retirement, college, down payment for a house
- Lifestyle: eating out, luxuries, home decor, technology, Amazon Prime, cable bill (or, better yet: Netflix).
But what about our time?
As we age, we begin to realize the value of our time on this wet, spinny rock. We begin to pile too much on our plate and, like a ship taking on water, slowly sink under the weight of all that we took on.
The promise of the 50/20/30 rule is sustainability. It doesn’t promise untold riches. But what it does do is give us back control of our time so that we can grow. It gives us control of our time so that we can have time to go after those untold riches.
But what it also needs is a commitment to it, and a sacrifice to sometimes say no in certain categories–even the essentials.
So what are these three categories? For me:
- Essentials: school, work, job searches, shopping, chores and maintenance, commuting
- Future: workshops outside of school, seminars, investing, budgeting, exercise minimums
- Lifestyle: hobbies, travel, friends, eating out, further exercise, Facebook, other stuffs.
All are important. If we don’t work and advance in our career, we risk being totally screwed financially. If we don’t plan for our future, we risk stagnating and not growing. If we don’t invest time in our own satisfaction we risk damaging our mental and physical health.
All work and no play makes Jack a dull boy and Jill a rich widow
So here’s the deal, adults need about 7-8 hours of sleep to stay healthy. That should not change and should not be factored into any category. Taking the maximum out of a 24 hour day leaves us with 16 hours. Of those 16, about 50% is work already. That leaves us with 2.4 hours for lifestyle and 1.6 hours a day for future activities. Don’t forget about weekend: two days where the 50% should be smaller to counteract the focus on essentials during the work week.
Do I suggest following these numbers religiously? Heck no!
Do I suggest using the as a guideline to help us make a decision on where to invest our time? Indubitably.
For many of us who struggle with time management, this might just be the ace in the hole. The difficulty will come in knowing when to say that something is good enough. In prioritizing and ensuring that we keep to these guidelines. It doesn’t mean that we won’t ever have killer work days or that we should slack off.
It just means that there’s a time and place for everything.