This is the ‘Jay Leno rule’ of saving money — and you don’t have to be rich to make it work for you Friday, September 30, 2022 5:21 PM GMT+1
       Reset Password        Click here to sign up.
 
daily devotionals online
Home
       our daily bread
Our Daily Bread
       the good seed
The Good Seed
       the LORD is near
The LORD is near
       andrew wommack
Andrew Wommack
       billy graham
Billy Graham
 
christian topics
Christian
       general topics
General
       interesting topics
Interesting
 

Interesting Topic

This is the ‘Jay Leno rule’ of saving money — and you don’t have to be rich to make it work for you - Interesting

This is the ‘Jay Leno rule’ of saving money — and you don’t have to be rich to make it work for you This is the ‘Jay Leno rule’ of saving money — and you don’t have to be rich to make it work for you
Posted by Temmy Tue, August 09, 2022 2:26pm
Details
This is the ‘Jay Leno rule’ of saving money — and you don’t have to be rich to make it work for you

This is the ‘Jay Leno rule’ of saving money — and you don’t have to be rich to make it work for you
Comedian Jay Leno GETTY IMAGES/ISTOCK

Comedian Jay Leno has openly shared that while collecting two salaries — one from his ‘Tonight Show’ hosting gig and one from the 150 annual comedy shows he’d appear in — he never spent any of his ‘Tonight Show’ salary and instead only spent what he made doing stand-up. “I’d bank one, and I’d spend one,” the TV star told CNBC in 2016. “I’ve never touched a dime of my ‘Tonight Show’ money. Ever.”

Okay, but Leno’s rich, you might be tempted to say. Still, pros say that this ‘spend one, save one’ philosophy may be able to work for some families. “This idea is a really smart behavioral finance approach to handling income for a two-income family. By living off one income and saving or investing the other income, a two-income family simultaneously automates their investing and keeps lifestyle creep or lifestyle inflation to a minimum without having to fight over how much of each separate income to set aside or spend each month,” says certified financial planner Kaleb Paddock of Ten Talents Financial Planning.

Indeed, pros say that in addition to saving 10-15% of your income for retirement — even in this high-inflation period, families should have somewhere between 3-12 months of savings in an emergency fund, preferably somewhere very accessible that pays interest. Luckily, high-yield savings accounts are paying far more than they used to.

“With the family living on one partner’s income and then saving the other partner’s income, they should be able to hit major financial goals more quickly. These goals might include saving for a down payment on a house, saving for retirement, saving for a family vacation or even just saving for a rainy day fund,” says Chanelle Bessette, banking specialist at NerdWallet.

Of course, this is far easier said than done. Many two-income families are struggling to get by even though both partners are bringing in money. And even if you can’t save the entire second income, trying to save more of it is a worthy goal, pros say.

How might families make the ‘spend one, save one’ rule work? Paddock says couples should create two separate checking accounts for the two incomes. “In one checking account, all bill pay and credit cards would be automatically paid from the one income while the other checking account can have an automated transfer to a brokerage or retirement account on each pay day or once per month to effectively sweep the income over to an investing or savings account. Keeping the accounts separate can help with tracking how much is being invested over time and there’s no confusion of mixing expenses with investing transfers,” says Paddock.

Certified financial planner Don Grant advises reviewing your spending and netting it against your income. “Take the time to clearly define wants and needs. Cover the needs first and if there’s a surplus, those assets can go towards more discretionary spending,” says Grant. From there, he recommends setting up two accounts that are specifically dedicated to each goal. “Some may be short-term, other goals like retirement will generally have a much longer time horizon. Develop a plan for how much will be invested into each account and invest it according to your specific needs and risk profile. Monitor the account and make adjustments as you reach your goals,” says Grant.

Because this process assumes that one partner’s salary is enough for their household to live on while the other salary is saved, you might want to adjust the numbers to whatever makes you feel comfortable, like saving 50% of one partner’s salary instead. “Any progress towards savings is good progress. It’s also a good idea to make sure that both partners have access to all household joint checking and savings accounts and that money decisions are made together,” says Bessette.

Source





 

More From Trending Chat Room Archives


Gwyneth Paltrow
Gwyneth Paltrow
Posted on Fri, April 16, 2021 12:19pm
Gwyneth Paltrow admits her mom is shocked by some of Goop’s vagina-related products



Vagina-scented candles and vulva coloring books are a bit too much for Gwyneth Paltrow’s mother, the actress and Goop CEO revealed on Thursday.

On NBC’s TODAY Show,...More
Naomi Osaka
Naomi Osaka
Posted on Tue, June 01, 2021 5:59pm
Naomi Osaka Quit The French Open To Protect Her Mental Health



Naomi Osaka became a household name when she won the U.S. Open last summer — and did it while wearing a face mask with the name of a different Black person murdered by racial violence on each day of the...More
Business Deposit Accounts
Business Deposit Accounts
Posted on Tue, August 10, 2021 4:23pm
Stimulus Update: Next Payment for Parents to Come Earlier in August



Parents will get their Child Tax Credit payment on Aug. 13, instead of on the 15th of the month.

Last month, parents received the first payment from the expanded Child Tax Credit that was...More



 



For enquiries, notifications and ad placement send mail to [email protected]
Copyright 2012 - 2022 All Rights Reserved.
Privacy Policy || Terms & Conditions