To live a balanced life you need to follow the three-jar principle, where you need three jars— one jar for investing, one for saving and the last for spending. You must put equal money in all three jars. This way you have some money for the future and some to spend now.
What is investing?
Investing is making your money grow. When you invest, your money grows more and more. You can invest money in stocks, in real estate like buying a house or a building or paying for a university.
What is saving?
Saving is putting your money away for the future. You can save money to buy a computer, refrigerator, car or even to renovate your house. When you get some money in your savings jar, keep it in a savings account in the bank as it is better, safer and you get free interest on your money and your money grows automatically.
What is spending?
Spending is keeping some money that you use for things that make you happy like buying a bar of chocolate, watching a movie, buying clothes and many more things.
When you use the three-jar principle, you don’t need to worry about how much money you have spent.
