Recently, I posted an article about how to effectively save for vacation. It’s important to me that I take a break every once in awhile. I need the time to recharge and reconnect with what’s important to me. Everyone needs that.
But one of my readers came back to me with this criticism: It’s easy for you to take a break. You’re rich.
There are a couple of things that bothered me about this:
- I get it. I grew up in a trailer park, and was a single mother with over $100,000 in tax liens in my 30’s. But I worked my ass off to be able to do this.
- Riches alone aren’t enough to travel without worries. In fact, a lot of “rich” people go on vacations they can’t afford. The ONLY reason why I’m able to take a break is because I have a secure money system.
For real. My Kashflow System allows me to save up the exact amount I need in order to travel without stressing about it. It never fails me.
And that’s part of why I’m so passionate about teaching it.
Everyone deserves to be able to go on vacation and recharge, especially after a demanding month at work. In fact, everyone needs to. If we don’t take time to recharge, our bodies and minds will break down.
And this is also why I’m so passionate: the purpose of growing our money is not to buy more shit, like consumption culture has led us to believe. The purpose of growing our money is to take care of ourselves, our families, and our communities.
We need money to be able to take care of ourselves and take breaks. If you want to travel four times a year like I do, you need to implement a money system.
So, to help you get started, here are the three components to my Kashflow System:
It’s not about income. Income is just an accelerator. It’s about how you flow your money so that when each paycheck hits, you need to know where to direct your money so that it works for you. Establishing a flowchart will allow you to visualize this.
Here’s how mine works:
Cash security is everything. You need to have several buckets (or accounts) set up so that all of your bases — self-actualization (“retirement”), health, living expenses, goals, etc. — are covered. The more money you have in each of these buckets, the more confident you can be that when life hits, your quality of living won’t drop.
My Kashflow System comprises of 8 total buckets; Taxes, Wealth (Investments), Wellth (Preventative Healthcare), Living & Luxury, Rainy Day, Education, Dreams, and Debt. (If you want to learn more about what each of these does, join me on Wednesday when I will be teaching my system in full!)
The power is in the formula. Too much of us live off of the majority of our paychecks. The truth? If you are living off of more than 40-45% of your income, you’re screwed.
My principle is 20/80/20: 20% of my paycheck goes to my Future Self (Taxes and Investments), 20% goes to my Current Self (Living/Luxury and Savings) and 20% of that 80% goes to my Savings (Rainy Day, Education, and Dreams).
These are the three most fundamental components to my Kashflow System. But it goes deeper than this. I could spend hours, days, if not weeks breaking it down — and that’s why I’ve put together the 28-Day Mindful Money course, starting August 1st.
Why? The Kashflow System works. It’s the very system I used to dig myself out of those $100,000 in tax liens, and the very system that allows me to take care of myself, and take a break four times a year.
If you want hands-on help in implementing my system, check out the Mindful Money course.
(Photo courtesy of Superfamous images.)