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I think that we should allocate our money into 5 categories.

1. Necessary expenses. I am talking electricity bills, food, school fees (if you are studying or have children), housing, healthcare, and transportation. I believe this group is where most of our money goes because we basically can't survive without these things.

2. Emergency fund. In cases of emergency, we should be able to get some money for it. Especially in countries where healthcare is not free, we should be prepared to pay if ever we get into accidents or we get sick though hopefully it never happens but still we have to be always prepared either way.

3. Savings. Some people save up for specific things like buying a better house, a better car, getting your kid into a better school among other things. Some people may just save for the sake of having money to pull for emergencies. I think emergency money and money I want to use into building a new home should be separate.

4. Investment. Aside from our day jobs where we get most of our money to pay for our necessary expenses, we should invest in assets to make our money grow. This could be gold, real estate or cryptocurrencies.

5. Luxury. When I mean luxury, I do not actually mean it has to be expensive. But I say luxury because there are things that we do not need but still want to have or experience like traveling or eating at a good restaurant. I believe that even though we should be smart in finances this does not mean we have to completely deprive ourselves of enjoyment.

Is that based on ranking? If so, the ranking looks accurate.

But I read a book that suggests a better approach, after you receive your income, it should be income → savings → expenses, instead of the usual way. It’s a way to discipline yourself and prioritize saving, because that savings will be the one to cover your emergency needs and future investments.

Is there any adult not spend their money in these 5 categories? I'm sure all adults spend like this!

They might not invest in gold, Bitcoin etc, but they invest in banks which generate 1%-7%, they call this low risk investment.

Luxury spending for men are quite different, they invest in their hobby, gambling or prostitution, but still those are belong to luxury.

The difference is the way people budget it, someone might budgeting 1% for luxury, while the other one budget it as high as 20% for luxury because they said "you only live once".

You should include this one.

6. Leisure
This talks about travel, going outside with your family, an other things on which this would be that out of the budget.

7. Wants
We do have our own wishes in life specially on buying up gadgets, cars and other wants on which you should be that also putting up some budget allocation too.

We do know that there's something that would be that totally be those things that we do spend out on which it would be that resulting into that out of budget.
This is why its important that you do always allocate something for you not to get over dropped or would be that out of budget. It all matters about on how you do handle things
accordingly on which it will be that ended up for you to have that shortage of funds. It all matters about money management because if you dont have these things then you would be having
that problem later on.

First of all, you have to spend your income on necessary expenses. Then, after calculating how much it's going to cost you, the rest of money should be destined to savings. From savings, you split it between investments and emergency fund (which just remains on your savings, anyway...). Once you feel more comfortable and your financial life gets more organized, you can start giving yourself the right to spend on luxuries.

If you want to make financial progress faster, you have to postpone spending with luxuries, though. The point is: are you able to postpone pleasure and rewards without compromising your emotional? If it sounds unbearable, then it may be a serious issue...

I think the list is partially accurate, there are people that never gets to the stage (5) of buying luxury things. Spending on the primary needs are definitely important for survival, savings and investing is to pursue more financial growth and wealth and only after one has archived that growth that is when they can afford luxury but when they are not able to have a stable financial status, it will be difficult. I agree with what the first comment said about considering savings first before expenses, because if you agree that you would save 30% every month, once the salary comes, you need to keep the savings apart first before you spend on your needs, that is how I believe it's done.

I would not separate the second and third; all of these can be combined into one category. Moreover, money should not lie idle; it should also work. If you have a certain amount that you consider savings (3), they should also bring you profit. Passive income does not necessarily have to be investments. Buying real estate, and renting it out; after receiving profit, you also make your money work, sending it to investments. As for the fifth point, it will be reasonable if you have already established all the other points. Sometimes it is worth being patient a little in order to live a measured life later.

These five categories cover, to a large extent, the areas we need to allocate our income to. But how we budget or allocate our income will depend on how much we earn and the cost of living in our country. Some people will never have savings except their earnings increase. This is because what they earn is not even enough to cover their basic needs.

But those who have enough should make provisions for emergency funds and investment because the future is not predictable.  

necessary expenses are the kind of expenses that we can not avoid because it's a daily basis needs. And like you said that it includes foods and other necessary things which you mentioned earlier.
this emergency funds is very important to one's live because without it you might begin to sell of your properties when an emergency issues arose. This is needed even though you are not into investment. If you are into investment that will take long term before you make a better profits you actually need it so that you  do not take from your investment capital before it matured.

know your financial capacity and allocate your funds based on it while taking notice of the need to do proper scale of preference analysis so you focus first on things that matters most and then pay the lesser attention to things that does not matter all that much. the first things first is that there should be proper allocation for your needs. once that is sorted out, the next thing should be to allocate for your investment before you can even talk about allocating for other things which can be jointly referred to as wants.

it takes some sort of robust finance before you can easily allocate funds to all the options you have pointed out because for the majority of the average person that does not have too much, the highest you can really do is to ensure that you are taking care of yourself first and then you can talk about investing. it is in the long run when you must have balanced well that you can then consider making proper provision for emergency fund. everything is just in phases, it is when you have grown that you can really have the ability to implement a lot of financial strategies but getting the knowledge first is still not a wrong way to start.

I like OP's arrangement better and that's what I'm applying to my life. I think we should prioritize essential needs before saving, we cannot save money when the family, especially children, still does not have enough food on the table or the bills are not paid...


Also, I guess many people will ignore this because they think it is a waste. But I think this is necessary, we should also take time to rest and enjoy life, we should not be too strict with ourselves.

An individual who is old enough, that is making their own money, it's certain that they will have themself spending their money on the five things you mentioned on without hesitation or being told about it because as it is, it is our responsibility to pay our bills, take care of ourselves, prepare ourselves ahead for the unknown, plan, and set goals for future.

These are books to keep people poor if you ask for my honest opinion. Any book that divides the income into savings and expenses only is encouraging people to just live an average life. This is because it is obvious that savings does not make anybody rich but investment does. Any money that is not creating more money is idle funds that will be dealt with by inflation. The right thing to do is divide the income into necessary expenses, investments, and emergency funds which will take care of things not planned. Investment is the right thing to do at this time and anyone without a clear view of where to invest in can simply invest in Bitcoin which have been a reliable asset that generate so much profits.

One thing you should not tell a man and that is what to spend their money on, this is one rule I hold I highly esteem. The public these days is quick to tell a man that they did not help make money for how they should spend their money.
It better to advice people on having savings or using a conservative budget but actually tell them the things to use their money on is a complete no for me.

OP, you are right with the five categories the way that you listed it. However, I will love to keep my savings in bitcoin if I have plans to buy a house or a car or something very expensive so that inflation wouldn't eat up my savings in fiat. As bitcoin price increases, my savings also increases simultaneously with bitcoin price. Emergency fund is good in fiat or USD.

These are good points, if I had to pick between saving and investing my money i would go with investments because savings don't appreciate overtime, an investment can build up and give you a high value in the future... necessary expenses Is a must because they're your responsibilities to take care of, these things cannot be avoided...The last point is also very important, eating good food and making sure you are in sound health isn't a luxury but a necessity

No doubt OP done good job for pointed out things like these but for me, he has done more work because here all can settle these things into 3 ways as well because Necessary expenses and Emergency fund can be gone into same way while Investment and Saving are also on same page with some love to have their savings in good investments.
Usually peoples those are stable in their life have things like these because they always think for long term and have good strategy for their life after retirement but many those are living in regions where things are not stable never have luxury like this to work out and stay in balance.
Few countries are developing good culture of having good saving plans for their citizens which keep them good in long run but this need strong and good strategy with good government which works for their peoples.

I agree, this is kind of toxic masculinity.

I know the @OP didn't specify it for men, but we're in Bitcoin forum, pretty sure most of the users are male.

When someone spend their hard earned money, we, as people who have no contribution to their life, have no right to suggest or give advice without they ask. Just like I see my friends spend money for donation, realistically speaking it doesn't give any return to us, but if they want, then why not?

Another thing you didn’t mention about what to spend your money on is investing in the development of your skills. If it costs you money to gain knowledge that will bring value, don’t hesitate to spend it. Learning to acquire knowledge is always expensive, and there is a benefit to every piece of knowledge. However, when people choose not to spend money on themselves, they remain ignorant. While considering how money should be spent, it is important for people to always think about value, things that will bring value, because if money is spent on things that don’t have value, then it is considered a waste of money.

It is impossible to get rid of these expenses and these expenses will accompany everyone until the end of their days.

Having some spare money saved up for a "rainy day" (for emergencies) is also a necessity.

I propose to combine these two points, since saving/accumulation without investments becomes practically meaningless (long) due to inflation. Saving money is possible only under the condition that this money brings some income, and doesn't lie as "dead weight".

The result of investments (profit) can be used to buy

This is an unnecessary item that will only "burn" your resources in vain. I would call it "an unaffordable luxury".

I agree that everything listed are important but spending money wisely is the key. For you to spend wisely , you must start from the most important one.

And number one listed is the most important because you can't have children at home without food on their table and then be thinking of investment, luxury, and even savings. The necessary expenses such as food, house rent, school fees, and health care must be taken care of first before the other ones.

The remaining expenses, such as savings, investment, and buying of luxury items will depend how much income the individual makes. You can guess that some people , after spending on the necessary expenses, they do not have funds anymore for investment or even savings. That is why I agree with you that spending wisely is the key because even those with enough funds start from the most important things before giving themselves luxury  things, knowing well that the essential things have been sorted out.

What people mostly know is about needs and wants. So, we have to spend our money with the needs first before going with the wants. And the luxuries that you've mentioned is better if it's said as wants. Because that's indeed what we have to spend sometimes to give ourselves the luxuries of having a job and why we work for it. We provide but we also need to provide for our own happiness. If things such as what we like to have makes us happy, we shouldn't deprive ourselves with it because as long as we are paying the bills, we provide food to the table, we deserve that kind treat to ourselves.

I agree with your first point because I believe every person goes through the phase at some point in their life where they don't get to have or enjoy any luxury or fulfill their wants, and it's because whatever they earn mostly goes into basic needs and savings; most people can't even make investments with their regular income because it isn't enough. If you save some of it, you won't have anything left that you can invest, or it won't be enough. So it's better to just add the little that remains into the savings, or maybe keep saving that separately so that you can invest it when it becomes a good enough sum.

About the second point, I think not everyone can do that. You will only be able to save a certain percentage of your income before you sort the basic needs if you know you earn enough and the remaining funds will get everything covered, but if that's not the case, you will probably try to solve the necessary problems and fulfill the basic needs first and then see how much remains that can go towards your savings.

Some people can't even save anything because their income isn't enough to cover that part, unfortunately.

It's good to remind everyone, especially those who are perhaps still trying to find their way into adulthood, about how they should be allocating their often limited financial resources. It all comes back to having a proper budget really and then starting with your income for the month versus outgoings. You can almost write off the funds required to cover "necessary expenses" into a black hole as you often have limited control, but should be looking into things like reducing energy costs and your rent/mortgage where possible. The emergency fund should really have a cap, say 12-24 months expenses maximum, which means you'll eventually stop topping it up and it can be merged with investment funds as long as you segregate it properly (i.e. into government bonds which are ultra reliable). I'd call it fun money rather than luxury, because you can often get a lot of pleasure out of the cheaper things in life - like spending a bit of cash at the arcade or treating yourself to fast food. Savings could also be part of your investment fund and/or emergency fund, so it doesn't need its own exclusive group.

You need only one, assets. The others come later. Just collect assets for a decade or two and you’ll be living like a king for the rest the of your life.

Crypto, stocks, commodities and even bonds maybe. Keep FIAT at minimum only to buy the dips. The rest should always stay in assets.

When you get big and your passive income exceeds your income from your job, you can buy whatever luxury you like. Yeah that’s not easy I know but nobody said it has to be easy. Life ain’t no easy gaime mate.

That's a great list - because I personally spend a lot of money in those 5 categories.

You did a great research.

And savings and investment - some people might combine these because they are the same, some people consider them different where savings are in fiat and investment is in assets like Bitcoin or stocks.

But I myself now combine the two, the important thing is that there is an emergency fund then the next goal of investment must be grown.

I took my time to read through the entire reply section hoping to find a particular thing, but regardless, i think OPs points are quite okay, but just that i might personally think that some of these categories can be a sub category to another. What do i mean?. Take savings for example, i personally don't like saving especially in cash just for the sole purpose of using it for future purchases. Instead, i feel every penny that isn't part of my Emergency fund and my day to day expenses which are very necessary, should all end up as an investment instead. It is best to use such investment and the generated profit to buy the better house, car, and other things that you mentioned, than to just save alone. This isn't and shouldn't necessary be the main investment though. Not everyone likes having cash lying around.

That aside, one other thing i think people can spend, or should spend money on, is on themselves.
Self improvements sometimes, or should i say, most times, demands some expenses and spending as well. There are some fields that knowledge is never sufficient, so in order to keep making progress, and keep earning more, you definitely need to know more, or have more skills. And those skill or knowledge comes with a cost, which sometimes has to do with money. Trading is a very good example.

Its a must to solve our needs before investing in Bitcoin or any kind of investment. No human can live alright and think about making investment while needs are not being met, the essentials of quality livings needs to be proportioned in the first list of spending. Bitcoin investment shouldn't affect our standard of living, not for those who display high standard above their financial capability, those who leave above their income will always return back to their investment for further survival when the main source for expenses finishes.

I like as OP kept luxury last, its rather not important when you don't have enough to spend for the lifestyle.

Adopting one asset and investing in it in the long term will lead someone to reach the point of financial freedom. It would be much better to diversify assets to minimize risk. But what is more important here is to determine the type of asset that has the most potential to provide significant benefits in the long term. I think Bitcoin and Stocks are pretty good choices, but it all comes back to each person perspective.

There are many challenges to discipline yourself in investing, and it is also not easy to balance needs and wants. For adults, maybe many of them have put aside their personal desires, because they meet the needs of their families, and it does not mean rejecting luxury. I imagine being able to enjoy the benefits of every penny of investment I have made in the future, that is the real luxury.

Good list by the OP and two good additions. With time most of us are able
to figure out what the important things are in life and what we need to fucus our
efforts on, Food, shelter and the future - the future being savings and investments
for a comfortable and healthy life.

In time we also realise that the "wants" are mostly depreciating assets and in terms
of investments are not great options, fancy cars and fancy watches etc. which dont
actually enhance our life.

The whole lists lies on good financial management and how we can maximize our profits.
Normally if we aren't drastically concious on how we spend our incomes, then we might probably be minimizing our incomes because a growing investment may require increase of capitals or diversifications of investment so that we don't only hold on one source of income.
So to meet up our investment goals, there's need to understand that spending on things that doesn't matter such as funds like gambling and out doors event should be treated like non essential or non profitable expenditures and long term goal should be made a prior to encourage a responsible and successful investor.

This could be an ideal approach if you are making a sufficient amount of income, but in reality, those who are living paycheck to paycheck will only fit their income up to their expenses only, no savings, not even emergency funds. Although I’m not saying to normalize this kind of approach, but it’s the sad reality these days, most especially that inflation stays for good.

However, still this is a good post OP. This should be prioritized to avoid financial struggles in the future.

I think we can generalize them into expenses and savings. Every time payday comes, you can easily divide your salary into two: expenses and savings. That's pretty much it. You can go 70:30 or 80:20 or 90:10, respectively, depending on your salary.

The money that's intended for expenses shall go to bills and the rest of what you regularly need. If there's an extra, it could either go to leisure or savings. If there's none, for as long as it isn't like that all the time, leisure and unnecessary luxuries could give way to savings.

Generally, savings is for many things. It's for the rainy days. It's for unexpected expenses, emergencies, investment plans, and so on. That's why it can't easily be sacrificed for wants and vices and other unnecessary expenses.

For others, there may be more than just the five areas of spending money, but for me, the most important thing is the ongoing expenses to meet daily needs. My family's daily needs are so high that it becomes difficult to meet those needs with my small salary. In this situation, I cannot spend money on other things, especially investing or saving for future security. Due to the large number of members in my family, I am currently in a difficult situation, due to which there is no opportunity to live a luxurious life or even increase my bank balance. So basically, 75% of my expenses are for meeting the needs of my family and the remaining 25% is spent on other things.

It's hard to prioritize savings if your income is just enough for your monthly expenses. For a family that earns minimum wage, if they have 2-3 children saving is not an option for them.


This is more easier approach. You can easily divide your monthly income into 2 then for your savings, it's up to you in what way how you will sub-divide it since not all people are confident in investing and rather just save their money for the future.

I completely agree with you because the expense lists are made depending on the income. Whoever has the income spends it to meet the needs of daily life. Saving is the most important thing. Many earn but cannot save. Whatever they earn ends up being spent, and finally, they become empty, and there is nothing to be said about their savings. Those who continue like this have to take loans in times of trouble later. Those who give priority to saving can overcome the danger beautifully with the money they save in times of trouble.

I feel like a lot of people lump emergency funds and savings but having clear distinctions makes a huge difference in staying financially prepared and focused on long-term goals.

It's easy to feel guilty about spending on things that aren't essential but it doesn’t have to be expensive, sometimes even a nice meal or a short trip can recharge us and keep us motivated to stick to our financial plans.

It is right that spending on unnecessary things will be called a sin. Because spending on what is not needed means wasting your money, for this, you have to be careful not to spend money haphazardly. You have to learn to use money properly; otherwise, it will be a waste of money. If you keep wasting money like this, then you will not be able to improve in the future.

Yes, sometimes good food and travel are necessary. When you have free time, you must travel, and if you have time, eating good food sometimes gives us physical and mental pleasure. Travelling is our need. When we travel, we can learn about many things that we cannot learn from other means. Eating good food and travelling gives us the strength to leave boring times behind and move forward in a new way.

As I understand it, an emergency fund is just a small part of saving, the purpose of saving is much broader. Savings are not just for emergencies, there are savings that will be used to meet future needs or goals such as investing, or saving helps us form good financial habits...But among savings, emergency fund can be considered the most special savings fund because it is our financial protection layer, it needs to be considered the most important.
I agree with you that we should separate our emergency fund from other savings to avoid confusion and misuse.

1. Necessary expenses.-You don't have any choice, when it comes to spending money for food, gas, bills, taxes, etc.
2. Emergency fund.-In my case, my emergency funds and my savings are in the same category. I'm sure that the same thing applies to most people.
3. Savings.-We have to invest our savings and not just put a bunch of fiat money in a jar under our beds. Inflation will eat our savings, if we don't invest them properly. I don't consider buying a better car or a better house to be an investment. Cars and houses are liabilities. They must be put into the "necessary expenses" category.
4. Investment. No need to add anything here.
5. Luxury.-Buying overpriced goods, just to show them off and brag about them. No thanks.

Is eating at a good restaurant luxurious and does that count to be a form of enjoyment? Do foods cooked at that restaurant can't be prepared in your home too. What I really think it's the best enjoyment is picnic outing with family or close ally, spending time in nature, going to beach with family and all these are not expensive but seems day fulfilling.

No matter how much you earn, ensure you save some part of it. It is common to hear people say that their income is not enough, which is why they are not saving anything for rainy days. The truth is that you don't need to earn more to be able to save, you can just set aside small amounts every month.  You will be amazed that you have a substantial amount at the end of the year if there are no emergencies.

You also don't need to be comfortable with a low-paying job because it might force you to take loans and become indebted. Seek a higher-paying job, learn a new skill, or improve your qualifications because you might need them to get additional income.

Yes, of course, Am investing in BTC by maintaining DCA from my small income. Investing in BTC seems like saving to me. It makes no sense to save and leave money in the bank, so i'm investing in BTC by maintaining DCA. I consider this investment trend an essential means of saving.

And yes, I do not waste money to feel more comfortable than my income, and I do not have any debt. I'm doing well with what I earn. Thank you for giving me your essential suggestion.

We probably won't be able to pay our expenses if we don't have a source of income, right? And this source of income can start with investment and if the investment we make or choose is right, we can certainly easily make savings, and other things mentioned.

So it's important that we have a stable source of funds to source it, because all of the things op mentioned are okay and we can all go through them except
for the luxury that not everyone can do.

If you are saving you better convert to stable coin before inflation will reduce its value. But again you can keep it in btc by which you can have more value for it incase price rises or you split into btc and stable coin but definitely not fiat. If you want to build house I don't know how much you want to save that you won't touch it or that inflation will allow you to have same value from when you started saving it. Instead you can reinvest that money you want to save into buying of land and you are likely to have more gain from it if you decide to resell and get money for a building your house. As to changing children school, well that may not require lot of money and time compared to money proposed for building, so you can save or gather that up.

The word investment can be classified into two sections. One is the appreciating one like Gold and Bitcoin, while the other are those that you mentioned there (E.g fancy car, fancy watch, etc...). In the name of investment, both types are beneficial for us. One provides wealth in a literal way because we can earn profits on them (usually passive), while the other is for our own well-being.

When we drive a fancy car and wear a fancy watch, we can feel good. It boosts our confidence. They are also useful because it tells us the time and it can transport us in our preferred destinations. It can even attract us a potential client for our businesses.

This should be one category... If your savings & emergency fund are in fiat currency, it will lose value over time, and if too much time passes, inflation will eat away at most of that value. That's I don't save in fiat currency, I don't have an emergency fund, but I do have some investments... if things go bad and I need the money, I will find a way to make ends meet until I can cash out some money.

It's the 21st century, saving has lost its meaning... unless you are saving in gold, crypto, bonds, or anything that resists inflation. And if you are already saving in this way, it's essentially an investment.



This one is tricky... but YOLO can be applied here, sometimes it's worth (and more) spending money on something nice.

Those who are young and not yet married have a different way of spending money and they spend most of their income on luxurious living as well as gambling and dance clubs.
But married people mainly earn money and save most of their income for future security and spend it on family needs.
My income is mainly for my studies and I give some money to my family and I keep the rest for emergency needs, but so far I have not been able to increase my bank balance.

All five are good by levels. It's just a bit confusing for people who don't have much income. It's difficult for them to manage these levels because all they think about is how they can eat for one day.
The five types of money allocation apply to the middle and upper income groups. For people with a lower middle class economy, it will be difficult to make that list.

I would make it simpler in allocating money, consumptive as needed. I will eliminate the luxury point.

Your 5 tips to spend money on are very well articulated because somebody that earns money is supposed to have a budget for their expenses so that when money enters they will not misuse it, when you don't have a plan for money you can easily waste it on things that are not important. Personally I have two categories where I divide my income, one is for unavoidable expenses like food and rent, the other is discretionary fund, it is from there that I allocate money for different needs. Emergency funds, savings, investment and miscellaneous, I have percentage of money that I put into the different portfolios. The day that you stop to plan that means that you have planned for your failure.

Just like what OP has mentioned, luxuries do not need to be expensive. So it’s never wrong to include luxury in our expenses especially if we also deserve some kind of luxury as a reward of our hard work and efforts that have paid off.

However, we should still prioritize saving over luxury. And most of all, we should fulfill all our needs first prior to acquiring some of our wants. Self-discipline is a must, without it, you will never achieve something from your own money or income.

From the listed things that is made up of the Necessary expense, I believe that this is the highest place to spend so much and can even make someone who doesn't earn much not to have the chance to save much because it has the kind of need that's inevitable especially when there is children such as the school fees and you will not only pay for that but also the necessary things that comes with it, notebooks and textbooks can also take alot of money, housing and transportation is not even mentioned yet, so actually except all this needs has been satisfied before a provision for luxury can be tested.

Sorry for little question, its based on ranking what five points have described?

for first point actually no doubt must allocated for Necessary expenses and its happening in daily day, weekly until our spending monthly spending for education cost, electricity bills, internet bill and residential rental bill if you don't have your own house. For Necessary expenses I think must spending bigger than other spend allocated how our Necessary expenses every day, week until month repeat every time.
I have important points based on my opinion about Investment allocated, for my self its really important and have to allocate as much possibility due our money increasing in the future not matter what kinds investment way as stock or cryptocurrency and gold. Looking for investment way have high return and faster increasing our assets such as investing in bitcoin and top altcoin. For emergency fund maybe could allocated around 10% until 20% of my assets because its happening at emergency moment only not every day or every week.

Savings do not actually mean they should sleep forever in our bank account, sometimes we also save not just to prepare for some unforeseen incidents, but also to prepare ourselves for our future investments. It could be  passive or active, it’s actually our own choice to make.

Now the last category which falls on luxury, I certainly believe it isn’t a requirement to achieve all of your goals first before you take chances to enjoy some life’s luxury. If you can include it in your money budgeting, much better. Because life itself is full of uncertainties, that sometimes we should also take time to reward ourselves before things end up late for us.

I will spend my money for Education, Health, Experiences, Investments and Giving back. First of all comes the education, Knowledge is a true power whether it's formal, online or books it helps us grow personally as well as professionally. I will spend money for my education for my children as it opens door to new opportunities and development. Then comes the health which is a Great blessing of God. Our body and mind are our assets so we should spend money on healthy food, our mental health and regular checkups, health is wealth.

I will spend my money in making memories with nature i will travel, attend concerts do workshops and spend quality time with my loved ones who are our real happiness. Then comes the investment which is must to survive in future critical situations. If we invest we make our back stronger by doing business or any other ways. The most important way to spend my money will be Giving back to needy people in the form of charity helping a friend or dupporting a local business. Helping needy people add more resources to our money. This way will help me in the life after death.

Everyone has their preference hence we can't expect everyone to see things in the same way you see things. Eating in the restaurant, a luxurious one can be seen as enjoyment to others despite it not being your thing. I love the way you listed them and I think that's the way we should be spending our money. Getting all the necessary things should be our number one priority, after that then we can keep aside emergency funds then savings.

With this strategy, your investments won't be sold prematurely because you have funds elsewhere to be used for other things while you're investment keep growing. Luxury should be the last thing you're allocating money to and this should only be done when your have enough leftover after sorting out the important bills. Money for investment should always be available too because that's what can change your story from being broke to wealthy.

What the OP mentioned is what most smart and disciplined people do, it is not really a secret. That said, there are people who invest their money and when they get the ROI, they spend both their principal and their ROI, if you do things that way, there is a high chance you'll never get rich. So if you actually want to grow wealth, you have to use compound interest to your advantage, and the only way to do so is by reinvesting, so that your returns and principal provide further returns for you and so on.

You're right setting up your salary for these five things will be beneficial as it will help you to set your financial goals and objectives right as this will help you to streamline your money only to things that are important and value to you


Setting out money for the purpose of investment is one thing that is very important because this money is one thing that is ment to be grown and not necessarily for spending and luxury only so people should always endeavour to make that that they prioritize investing

There has been an extra allocation for most individuals living in country where the economy is bad and any individual who is earning a little is thrown a lot of financial burden by either family members or their friends.
It is now almost like people have to make an allocation for helping people, if not they may have to make sacrifices and tamper with some other plans of theirs.

The only time you earn money from saving in the bank is when you are using the fixed deposit System which cannot be withdrawn untill a specified date, it increases based on the number of days that the money was being saved in the account but when it's comes to a savings account nothing is added, as a matter of fact some commercial banks end up taking little funds from your savings for ATM maintenance and all that

Nice and correct order, what you said and your order resembles a condition of money that I prefer and work on. Luxury should always be the last choice, trying to live a luxurious life with an ordinary salary is a very wrong choice, usually when you use your priorities for savings, emergency money and investments, the foundation is solid and sustainable at its best, so leaving luxury for later accelerates the others.

I feel like the list itself could be considered a luxury, the majority of the world probably only has the first 2 categories.   Just getting by with food, rent and taxes and the occasional emergency expense you can barely handle, the rest is a bit of a dream.
  Rich countries you might maybe have some kind of savings or pension via your government but its not a given and I think most of the world is lacking this.   Savings, investment and luxury all get stolen by inflation and other disasters in the economy largely paid for by the poorest; the only exception is the people who can save in a non monetary way somehow it has to be rare.

The luxurious life is not suitable for those who only earn 350$-400$, this amount is the normal salary here in our country every month, but what is sad is that most of the regular employees here are even though their salary is not enough, they still follow the trend and feel rich or at the same level as the rich people.

There are others who just to look rich buy class A mobile phone devices so that they look rich too or others can see that they also have a luxurious iPhone brand but it's installment, you know what I mean. Because what you say is true and real luxury is really just a bonus in reality.

I don't know why I have to feel like we are just jumping in the middle of a conversation here because the discussion does not have a classification. Although Op pointed out interesting categories that has to do with responsible and necessary budgets but the thread does not contain headlines about the essence of all that being listed as analysed there in.
I don't even know if we have to take this discussion as case study of financial management or a focus on expenses Op just picked random categories.

I just want to highlight the fifth point because most people have difficulty controlling their finances because of luxury. This starts because of an unbalanced life and most people pursue luxury in life that is not commensurate with their ability to produce so that in the end they are trapped in much bigger problems. An excessive lifestyle can make someone trapped in financial problems because in certain conditions income and expenses are not balanced.

Pleasure does not have to be luxurious by spending a large budget because sometimes pleasure can be obtained just by traveling with family. But the problem is that people think that to achieve pleasure they have to spend a lot of money, even though small activities done together with family can also be pleasure and peace of mind.

Food and rent are the most important categories because they cannot be avoided. Also included here are bills, internet and mobile communications. Here you can save money if you do not buy expensive goods and look for promotions.


I think few people put money aside for this, so everyone ends up in a bad position when something happens to them. And why not keep this money in good investments?



Same as point 2. Even if someone is raising money, isn't it better to invest it to make it work?

Our topic :)


It is better to value spiritual riches. Like books, for example. It is not expensive and makes you feel better, outside of the ordinary.

Why stop at five? There’s an invisible category: “spending for freedom”. Not the freedom that gets sold to you as a credit card slogan, but the real one: having the margin to say no, to pivot, to pause. Why is that never in anyone’s list? Maybe because “freedom” is hard to quantify, and anything you can’t quantify, the system ignores

Necessary expenses, of course. But who decides what’s necessary? For one person, therapy is luxury. For another, it’s survival. Transportation in the US is a car note, elsewhere it’s a bike or a walk. The way you spend is a direct mirror of your social programming and invisible privilege. This is why “budgeting” is always part philosophy, part defense mechanism

Emergency fund, savings; agreed. But the deeper problem is that most people’s emergencies are the system: layoffs, medical bills, sudden eviction. We’re all just betting that our “emergency” will be less catastrophic than average, while the market bets the opposite. There’s dark comedy here: we save not for what could go wrong, but for what’s now normal

Investments: the economy wants us to gamble because stable returns don’t exist for the masses anymore. Why else do you think retail trading apps look like mobile games? Capitalism figured out how to weaponize FOMO

Luxury is underrated and yet over-marketed. Genuine luxury is social capital: time with people who get you, mental clarity, days with zero notifications. But most people spend on distraction, not on joy

Your details are quite logical. We all earn income for our expenses and to live a happy life. After earning income, whatever is left after meeting our daily needs is considered as savings and is used in times of emergency. However, many people want to live a luxurious life if they can earn a little more money and enjoy that life. It depends on their income and their mentality. Many people are very stingy despite earning a lot of money because they only chase after savings. However, it is very important for everyone to know a proper money management so that they can enjoy all kinds of their life.

I partially agree. In my opinion, emergency funds, savings and investment should be considered as a single category like bitcoin and gold could act for all these three purposes in my country. I guess in parts of world where people may not use bitcoin or gold in emergency times still your savings and investments can be on gold or bitcoin regardless of where you are living in the world, I am sure. I completely agree that luxury must be should be treated with least weightage.

You should choose a right investment which comfortably beating the inflation. There would be no point of saving or investing which are providing returns lesser than the inflation rate.

there's a new book Morgan Housel will launch soon called "the art of spending money", I really want to read it
maybe some here are fammiliar with his other best seller "psychology of money", it's a basic one but really interesting
my new first recommendation if someone asks me what to read about making money and investing

I'm way more interested on spending in experiences than things, here
and at the end of the day so many good things in life are free

• Point 1 is finished, what else can I do, inevitably the expenditure must be done, the fee is indeed routine and required, there is no other way, except: the country bears all of that such as Norway, Finland, Germany and others.
• Points 2 of course emergency funds are very important, we never know what will happen to us, that is important, as well as points, 3 and 4.
• Point 5 I think it shouldn't, if luxury is draining a lot of money, just for a moment of pleasure, there are still many things that can be done.

Conclusion: The five categories if we can manage our finances well, of course these five factors can give us an established economy.

Luxury can be expensive depending on the person's income. If you can afford the expensive one without harming your finances, please do have it. I can think of luxury as a periodic thing, not what you get always, so when you have the chance and provision for it, please enjoy yourself!.

I always have some mini luxury on weekends to calm off the week's stress and as a means of relaxation as well as some major luxury(for a day) whenever I get a new contract. We live only once and as long as it is not affecting my finances adversely, calculated luxury is an asset.

Everybody is different & has different interests & wants so it’s impossible to suggest the five best things to spend your money on. All I would recommend is to spend money wisely but remember life is very short so try to spend on things that help you enjoy life to the fullest, within your budget of course.

All the things you mentioned above are things that everyone should do to achieve financial freedom in the future. I believe that all adults must have the desire to do this, even if they have not succeeded, but if we succeed in changing our mindset and are able to manage our finances well, we can definitely do these five things.

I just want to discuss the fifth point, because sometimes people think luxury is taboo, even though luxury does not have to be expensive. Sometimes we also need to make ourselves happy with the hard work we get and enjoy it. Believe it or not, if you are stingy with yourself, there must be something to pay for, such as illness or stress. So don't be too calculating, don't be stingy with yourself. Don't forget to please yourself because it will keep you from getting stressed. When we are not stressed, we can be sure that money will always be there for us, there must always be a way for money to enter our lives by itself. Because a happy heart can be said to be the strongest magnet for attracting money.

I believe that distributing funds in this manner across five categories is general and not necessarily appropriate for everyone.

Because I believe the issue is relative and varies from person to person and from country to country, income plays a significant role in the distribution of financial expenses. The higher income the greater the possibilities available for distribution, and vice versa.

I mean, for a poor person in a poor country the first item "necessary expenses" is the most important need. They may not even have the option to complete the second item, "emergency fund." Such poor people are only concerned with necessary expenses and cannot afford anything else.

Drop that to 3. Your expenses, bitcoin, and luxury. Because you can buy bitcoin, for emergency fund, you can cash out very fast very quickly, like in 10 minutes your bitcoins are fiat in your bank account. If you want savings, you can save money and buy bitcoin and save that, and for investment purposes, well quarter of the world had bitcoin one time or another.

So as you can see, all three of them could be bitcoin and you wouldn't need to name them differently. Every month, put some of your money into bitcoin and you will have a good return by the time you retire. It is the greatest retirement fund you could ever find, and some people wants to get rich tomorrow with it, that's their mistake. Just spend whatever you have, and save the rest in bitcoin.

This doesn't always have to be the case. A large percentage of investments don't allow their owners to save from their investment returns. This is normal if the spending ratio equals or exceeds the income ratio. Therefore, the investor will have to either develop his investment to achieve higher returns, which means additional spending and double the effort, or change the investment entirely, which is not easy to do because not everyone can change their activity and adapt their skills to the changes in the job market.
In a previous comment, I discussed the principle of "diversifying sources of income." I recommend reviewing my previous post in another thread:  https://bitcointalk.org/index.php?topic=5548522.msg65542694#msg65542694

I think it is good that we totally separate our savings from emergency funds. Doing it this way will give you more focus on meeting your financial target. Person like me I wouldn't want a situation were I have gotten certain amount of money in my savings account, all of a sudden emergency from no were will come and reduce the money. But when you have already prepared a different account for emergencies, you know that whatever that is here will be for emergency purposes alone, it will help someone to be more organised. Maybe when you run into an emergency that's bigger than the money in your emergency funds account, then you can borrow from your savings account. But make sure you refund it when things stabilise.

I totally agree with that. Most people won't even have an income enough for them to have savings, investments are a far thing for them to reach. Due to having a low income, such people will be forced to take loans and borrow money from others in times of emergencies because they could never save any money that they could use in such times, and it has obviously been impossible for them to have savings and emergency savings separately. So I also think that the order or the list of things that a person would spend their money on would differ based on their income and their priorities.

When I say it depends on priorities, what I mean is that some people like saving money, so that they can have a sum that can be used either for investments, emergencies, or to buy things they always wanted to buy, but some people wouldn't have such a mindset, and they would invest anything that they can spare, either in assets such as cryptocurrencies, or in gold or something, but they don't save that money for the future.

Most people this is where their salaries goes. There is no room for spending to luxuries or some things that they want to spend to. And that's why if they want to do those things as luxuries, they are looking for another job. So, having 2-3 jobs are pretty normal nowadays and the first job is the one that pays for the rent and food. The second job pays for the bills and then the third job is what pays for those things that you want to do. It's a tough life nowadays, most don't look to work-life balance anymore but barely survives.

I think this point is more accurately called DESIRE (based on the material explained).
Desire is something that is not essential, in other contexts it can also improve the quality of life, such as wanting to have luxury goods, eating at luxury restaurants, entertainment and vacations, these things are choices (not too much of a priority), you can arrange the right time to enjoy the pleasures of life when you get additional income.
I prefer to make wiser financial decisions to achieve better life goals, savings are certainly very much needed and can also be used as emergency funds, but when the funds are not touched after monthly financial planning, I will allocate them into investment.

That is an interesting approach but I have tried this and it really is not as effective, I must say because the money for the expenses usually comes in short. Then the money saved I feel like will be taken away. So, I like to pay for all the expenses first before I save the money. That way, I have no more to worry about.

there is surely nothing wrong in your explanation or your arrangement, anyone may still come up with his own table or arrangement since everyone has the right to do what is best for them. but the main point is to spend your income or money wisely because no one will come to bail you out when you fuck up. we should try to prioritize the need before want because if we prioritize want instead of need then we are surely not following the right approach and it will lead to not making a wise investment decision. dont forget to put your money to work because the source of income is what really matter and not how to allocate it. the rich people prioritize putting their money to work. meaning that there money work for them not them working for their money. at least this should be given a major priority.

The three basic necessities of life are food, clothing and shelter. You cover two in your list and omit clothing. Perhaps, it was intentionally omitted since it's not something we buy regularly.



I think this is where health care rightfully belong to and not in the first point. Emergency funds are meant to cover health care, unexpected maintenance either in our house or our drives.



Emergency money is quite different from saving. Just like you explained it, saving is to achieve a specific goal like buying a house, car or start a business. Emergency funds sit idle until emergency arise before it can be used. People actually misunderstood saving and emergency funds to be the same.



This is the purpose of saving. There's no point saving raw cash for future because it will devalue in the long run due to inflation. After a reasonable saving, you push it into investment to generate profits.

As for me, I don't think I needed to take this long before making decisions on what to spend my money on, because if you ask me, I will give the list below as what i will be liable if spending my money on, as our needs atimes may differs from each other base on personal interest and demands.

1. Primary needs, Food, Clothes and Shelter.
2. Investment, something that can be a profitable source of income.
3. Myself, the Family, relatives and any other person in need of help in the society.

By allocating an appropriate amount, our lives can be much better, the first to third points are definite needs and this must be met for anyone, especially for those of us who are married. But if you want to be better, maybe make a percentage limit, such as for the first point 30%, for the second point 50% and the rest can be placed 20% for the third point. If asked why the amount is more focused on the second point because it does concern our future so it is much better if the allocation is larger.

When people have a well-organized financial management, I am sure their lives can be more focused and easier because sometimes the only thing that is difficult is talking about prestige and that is what ruins all the plans that we have arranged. If expenses are much greater than income, then this is a problem and a solution must be found immediately so that the problem does not increase in the future.

Unconsciously, we all do these 5 categories but with different portions, adjusted to each income. Although not specifically set it consistently, I am sure we all try to stabilize every expense so as not to be excessive. for example, the luxury that OP conveyed is quite relevant because we need entertainment, brain reflection so that we can be fresh again to start working and I prefer to call it a psychological need.

the most interesting thing imo is that no matter what you build you'll have to be ready to let it go when the time comes
nobody lives forever (regardless of what the new rich want to build when it comes to longevity)
every satoshi you make will be left behind the moment you die, it's up to you to decide what to do with it while you're alive

Ahh 1000% I agree with you, because in the end the life we ​​have will be useless if not enjoyed, right? besides that we also need to create happiness for the people closest to us while they are still alive. Because it is useless to produce as much as possible but we forget how to make it a happiness.

OP made interesting topic and Expenses are main part of our life because without expenses we can't spend our life . We have to pay bills , milk cost , meal cost and other things which are required to live life. Clothing is also big requirement of us because we want more attention of people and that is possible by only best clothing and best dressing. Saving is also best strategy because we have to save money if we want to make more money in future and that will help us to to invest that money in best investment.There are people who saved money but they are not doing investment because they don't know how to invest this money.

I like your priority setting as you give each need a percentage. It is not simply a figure and some kind of awareness that we cannot live today only. This is not like we are neglecting the present moment when we provide more portions in the future, but it is just imparting between the spaces in order to make our life have some direction in the long run. I believe we fall in many times not because we lack the money, but because we forget that we ought to restrict ourselves.

Actually, many people can live in peace but they get fatigued owing to their adherence to their momentary fancies. When one is able to speak the truth about what is actually important as you did then money will not be such a problem. We do not have to live extravagantly but we need to have enough to live with a decent scheme. Once we reach such a stage, we can pay more attention to the creation of our habits, not simple satisfaction of desires. I believe you are going in the right direction.

I doubt if all adults spends their money on the five categories listed they may send on few but not all, i have seen adults who spends their money on unnecessary things, such as going to club, womanizing buying things on a high rate just to show up.
There are adults who spends their hard earn money going for places to places just to bewitch their neighbors due to hatred I believe such people who falls in these categories will surely learn in a hard way. Most adults are also addicted into gambling and 80% of their income is been budgeted for gambling. Everybody can never do things right.

Whatever you spend your money on you owe no one any explanation but if you spend money on your self to catch fun and make merry you sure know that at the end death death is inevitable. Let the people around you have something they will always remember you for thetx is the essence of investment and it you are able to take care of every one around you then you have nothing to worry spending on yourself to take care of yourself.

I agree with you that the situation will vary from country to country and even from person to person. Many factors such as a person's expectations, the economic situation in their country, and the person's goals can cause these categories to differ. People's needs can vary according to their economic situation. Sometimes the economic situation can cause you to have a single priority, and sometimes it can allow you to make plans and implement them in many categories.

All the items conveyed by OP are indeed very good, and are indeed needed by every individual. However, the problem is as OP conveyed, not everyone is able to do it, especially for poor people of course they are only able to apply item number one, sometimes item number one is difficult to fulfill, let alone other items.

To make a plan or manage finances is actually easy in theory but in practice it will be difficult to implement, especially if income is limited. So the key to all of that is to be able to carry out all the items conveyed by OP by finding as much income as possible because with limited income it will be very difficult to run it. The point is, how much income is earned, making a budget is the main factor in our future financial planning which can help us manage income and expenses efficiently. because with a good budget, we can control expenses, minimize risks especially debt, and of course can achieve long-term financial goals.

1. This would be the bills and mortgages on which you would be needing to prioritize for you to live and survive on day to day.
2. Emergency funds is one of the most important thing to consider because you wouldnt know accidents and unnecessary situation could happen along the way.
3. Not only for your kids college funding and also this could act out to be your investment back up or business on which you would be needing up the capital.
4. Considering other source of income will be the best approach. Economic conditions become shit on day to day basis, so its just common sense on trying out to look for other sources.

You should be that sensible into your spending because money is something that you can easily earned and without having that proper management then you would be finding things to be problematic
and you would be having those regrets that you should have manged up your funds well when you do still have. Always be that cautious about spending into unnecessary things so that you wont be able to find yourself with those unfortunate conditions or situation.

It is a good idea to categorize our spendings but many people has poor management skills hence cannot follow a strict money allocation rules. Also if one has a fixed budget, or a tight budget, it is not possible to allocate spendings on all these categories. People with minimal earnings can barely survive. As for me, I spend wherever is needed but never on anything unnecessary or luxury things. Things are already hard enough, cannot effort to spend money on useless things. Surviving however we can, saving wherever possible, spending whenever necessary, this is my usual spending routine.

It depends on what someone refer to as luxury because what is luxurious to you might not be a luxury to another person. For instance, eating a three square meal a day is regarded as luxury to someone but hunger striken to another. Eating food with 2 meats is also considered a luxury to someone but not to another. What I will say in regards to this is it doesn't matter whatever you regard as luxury, what matters is living life within your financial reach and ensuring you spend your money strategically. Don't forget to enjoy your self. I do not believe in the ideology of saying you have to make so much money before you can enjoy. What if you die before the 'so much money' you're waiting arrives

If your monthly expenses are not fixed, then you will surely find it hard to save prior to spending. However, what matters is that you still reserve some funds for your saving, no matter what approach you follow. At least, when you have saved a huge amount, don’t let it sleep in your bank account because you are wasting such opportunity to grow your money.

Invest some of it instead. But make sure you do have separate savings for emergency funds so that there will be no financial problems when emergencies arise later on.

I think this is precisely the advantage of the "income - savings - expenses" model. It works because it forces you to confront your spending habits.  If the money for expenses comes up short, it means you need to re-evaluate your expenses, not abandon saving.  And if your expenses are consistently eating up your income before you even consider saving, then you dont have an "approach" problem, you have a spending problem.

There are adults that spend money on other things listed asides from an investment and this is the reason why they always end up broke because they don't have anything that's generating money for them. Those things you listed are unnecessary expenses and I don't consider them as luxury because it doesn't to me luxury are necessities for your comfort not mondane things that don't profit you in any way

People have different life’s spending priorities so we can’t expect that an adult will have to follow this or that. They may view a certain thing as a luxury while others spend on it as a necessity, so whatever makes them happy or comfortable, they will pursue on it and spend their income.

However, we should not forget to save regardless of its amount. Our savings will save our future’s wants and goals, and even future investments, that’s why we call it SAVEings.

Once I worked in the government and never counted my expenses, but then I saw that I was earning well, but at the same time, I could not put aside even a small amount per month. And then I decided to calculate what I spent everything I earned on. And then I was shocked, because I found out that I spent about 40% of my earnings on food. And I did not have to pay for an apartment.
I understand that all the people who constantly read their expenses are not surprised by such numbers, but at that moment I was simply in shock, because I thought that everyone spends very little money on food.

Yes, it would be that situational on which not all would be having on the same when it comes to spending or simply with the lifestyle they do have. Each of us does have that different problems that we do face up in life on which there would be those who are that financially capable and there are those who do struggle even on just buying up their food on day to day basis on which we cant be able to blame them out if ever they wouldnt be able to think up well on where they should be spending up their money because the main priority would be mainly be focused on food and shelter on which these are the primary things for us to survive and sustain. On the moment that you have some extra funds then this is where we do tend to scale up when it comes to lifestyle on which actually this isnt suggested because it would be ending up on the same story on where you are just living on paying up your bills and debts. I do prefer on staying up on where you have started and trying to save up and tend to make out some business or investment. It would be ideal that you would directly be scaling up your lifestyle just because you've seen that you have gained some better income.

Its not bad to buy up some rewards for yourself but the main issue on here is that whenever people had been that comfortable into their current condition then they would be that totally be that forgetting on what are the things that they must do or simply stick into their plans. There are those individuals who hadnt been able to think up that well because the yare making up some priorities in life. There are those conditions on which it pushes you to your limit and work hard. Some do get successful and some do fail no matter what they do. Spending up money on different allocations is normal because we do have those priorities and expenses. If you are just that earning sufficient on budget for food and shelter then you would be having a hard time on achieving or doing those other things and thats the sad reality that we do have into this world. There's always having those priorities over leisure but there are those individuals who do actually do the opposite.

Basically,I wouldn't want to separate anything here, they all appeared in an order of priority but personally and to whom it may concern.Apparently, investing on oneself increases Long term values and opportunities.
Self development is a foundational step towards all round growth, meanwhile personally I'ld rate myself that I'm currently serving at 3/5, and I'll also do better.

Cooking food at home can save you a bunch of money. You should try eating out, or purchasing your food at all times for a whole month, and then try buying the stuff and cooking at home for one month, make sure that you keep a note of the total expenses. You will be surprised to see the results. That is the reason why so many people prefer home-cooked food over food that they can get from outside, and apart from this, home-cooked food is also more healthy and hygenic as you are the person who does all the cleaning and stuff, and you will surely make sure that whatever you do, it's done with hygiene.

Another thing that takes a big portion of our income is the extra things, such as drinks, smokes, etc. If you enjoy drinking or smoking, you should know that you spend a good amount of money on these every month, but we barely keep a count of that, and if we do, we will realize how much money we spend on them. I wouldn't say that we shouldn't enjoy ourselves sometimes, but maybe it's not necessary to have a drink every day, especially if you are on a tight budget, or if you want to save some money. :)

The most successful people have invested to themselves first before investing in other things. They invest to improve their skills or they invest to expand their network. That is why they are not afraid to take risk because they know that it will grow them not just their network, networth but also them as a person. So, people who thinks of getting a masters, getting more skills through certification or attending more workshops or seminars, don't be afraid to invest in yourself because you'll be the one to earn that in the long run.

You are absolutely right that eating at home and cooking yourself is the most economical way to spend money on food, and you don't need to use food delivery or go to restaurants, because hygiene there can be different, and we eat this food ourselves. And then only our body is responsible for whether the hygiene requirements were met when preparing the products we ordered.
Well, regarding cigarettes and alcohol: I'm glad I don't need cigarettes, they are very expensive and harmful.

We can manage to invest in anything in this world, but the one thing we will not get deceived is when we choose to be the best of ourselves. I usually feel that the world is really unfair, however, it provides sufficient opportunities to those who wish to keep on learning and developing. We may begin at a point very far behind, but, still, by continuing we shall arrive. No matter whether they invest through certification, education, or by surrounding oneself with healthy friends, they all do it just as small bricks, to construct something much greater later.

Not all people have the strength to begin internally. Distracting attention to the outside things can sometimes be easier because the outcomes can be obtained instantly. But not the fast one, but the strong one, are the lasting ones. That strength is found in the way we form our thinking, in the way we adjust, and in the way, we appreciate time. When you are in doubt whether you should learn once more or open a brand new relationship, you should ask yourself one thing, do you want to grow, or do you prefer to survive? Since we can talk about more than just surviving, then it is obvious, we have to begin with ourselves.

Well investing on yourself is the best kind of investment as a starter and it will help you achieve a lot, it increases yourself worth, self value and opportunities. But I think the OP is talking about how to spend your income and thing to spend it on which is distinct from self investment.

Spending on planned things and strategy help a lot in self investment and are also prior to general development and growth of oneself. If you plan your income and how to spend it, it will guide your growth and development increasing your financial freedom.

Given with all of the people that are struggling, saying that the world is unfair to them. It's been unfair to everybody but we shouldn't dive and dwell there down at all times. We need to work on it, we need to do something on how this unfairness that we're experiencing will turn the table and will be favorable to us or will be changed. That's why if the time comes and we've earned decent money, we have to make sure that we're spending it for something that's important and productive. Not just gonna go to a waste. We have to grow, we have to survive but we also need to balance everything. We have to spend it on necessary things that we think is worth it.

Each of us has our own approach and way of managing our finances - it doesn't have to be perfect, but it's important to have and getting better is highly recommended. Someone who is suddenly given $1m will be poor faster if they don't have financial management - of course that's because their mindset is still about something that is consumptive and luxurious. There is nothing wrong with consumption and luxury as long as it is within reasonable limits - but also do not ignore other things that support your financial recovery in the long term.

Having a reserve and having an investment are two important things - the purpose of both is different in terms of time, investment is for the long term and reserve funds are for a relatively short term. But we must not forget - enjoying life is important, use a little money in moderation without damaging future plans.

It’s best to live a life wherein finances have been well-managed. You have your own investment on the process, plus you have a growing amount of profits you saved in your bank account. Almost a perfect life.

However, in reality, life isn’t as certain as it is, that’s why we don’t need to maximize our time in making money and multiplying it 5x to 10x. We should focus on enjoying our life instead, by living a simple means, even without luxury around.

I agree with you on this, in fact, there are some people who start making their standard of living very low in order to earn extra money, and there are some people who, despite having a small income, continue to behave as if they are very rich, that is, they have no savings for the future, they spend everything they earn. This is definitely wrong, one should never be careless in managing one's life, not excessively low, and one should not indulge in luxury despite having a low income, one should live a stable life through proper financial management, create a financial management according to your income, and save for the future along with living a simple life, one can find peace and happiness even by living a simple life without luxury.

That is why it is very important to record every expense you make even for the smallest things. Because without financial records, no matter how much money you have, you will still spend a lot on things you don't really need. I have tried to record in detail all my daily and monthly expenses and there I found that there were expenses that should not be so important to me such as paid subscriptions that I only use occasionally and eating at restaurants that I consider as self-reward but I do it almost every week. That made me realize that recording expenses is not to make you save, but to know and see expenses that escape your attention.

When you have money, you end up buying anything because you feel like you won’t be losing money anyway. Like it’s endless. Then at some point, you’ll be confused because you have spent some chunk of your money without remembering what you bought so you really should record your budget.

Everything here is important, although it's going to be hard to do all of these and still have savings but it shouldn't be overlooked. Most people value investments than savings and that's understandable but take note there are somethings that can come up urgently, this would require immediate attention, if you don't have money saved somewhere it's going to be very difficult to handle such situations

People need everything in their lives. Electricity is an important thing in their lives. If you use electricity, you need to pay its bill. People have a cost for everything, such as transportation, food and drink. These are our basic needs. We will have expenses on these. Because without them, we cannot move. We need to have some savings for emergency funds.
At any moment, people can face any danger. So, in times of danger, we can use that money. There are many times when we cannot get free treatment, then we need money.

 Saving is a good purpose in people's lives. Those who are able to manage their lives by saving are able to do something good in the future. Many times, money increases due to investment, which gives a very good result.

Luxury brings a lot of deprivation in people's lives. There are many things that we do not need, but it is not right that we buy them.

Basically I think the first thing that should appear in anyone's mind on what to spend on should be  investments because the sole aim of investment is getting returns that can possibly aid the needs and wants of the individual, apparently one can have resources and fare from it but the question should be is it ever enough to cover for the basic needs and wants of the person? Especially considering people that have family to take care of , school fees to be paid , daily feeding, logistics and health care.etc...
So it's not a bad idea for anyone to give sole attention to the basic needs but investments is what can make all of these expenses at ease for the individual when there's a possible returns it makes everything smooth.

But you have to have your financial roadmap including adding your value, you have to have a budget that suits what you need, a list of priorities must be really considered to see which ones should be prioritized, because I'm pretty sure everyone has different priorities, but most of them prioritize something that is actually not the time to be done at this time.

Self-development is very important because it will increase our value and get more financial opportunities in the future, therefore do not focus on what you want that comes from consumptive things but think long term with current capabilities is the right choice.

Household expenses and investments should be priorities for everyone. Maintaining the present and preparing for the future are essential. I have an emergency fund and a low-risk savings account (the return is higher than the standard in my country, which has an insignificant return). I have a smaller portion in medium to high-risk investments. Furthermore, I like to travel, but I try to spend as little as possible without being stingy.

They say we have to pay ourselves first, investing in assets and education, but for most people this is difficult. When you have a family to support, they become a priority, and you feel compelled to ensure their needs first.

Anything that is long-term becomes more distant than it seems. For this reason, most of my investments are short-term, with daily liquidity (I can withdraw at any time).

exactly!
since I was a teenager I know that it's not about how long you live but how deep you enjoy it, and this is not just about having fun and going to parties of course, you can really raise your quality of life by doing hard stuff like going to the gym and some of the hard things like raising children are probably among the ones that will give us the most purpose as well

there's this point too that relationships are much more important than material stuff
have you ever read "the republic" by Plato? it's a great book

I don't know why you added luxury to the five thing we ought to spend money on because I don't see any reason for luxury since the money that should be spent on luxury can be use as emergency fund. In as much as we can still get the same quality without buying brand name all in the name of luxury then their is no need for allocating another extra fund for luxury.

We should be more interested in growing more businesses to secure a consistent means of generating profits on a daily basis without spending too much on unnecessary things we can always avoid that will bring no adverse effect.

Yes, if we can cook our own food, it would be perfect. We purchase food from various fast food establishments, different types of restaurants, and roadside shops. We are unsure of the healthiness of these foods. We are not aware of the cooking process used by those who prepare these foods. Do they cook food cleanly or do they cook food haphazardly with dirty hands? We know nothing about these foods. These foods are highly detrimental to our bodies, not only harming our health but also incurring additional expenses.

Above all, if we can cook our own food at home, it will be the best. By doing this, we will be able to prepare our own food in a healthy way and we will be saved from spending various types of extra money. Healthy food is necessary for our body, if we cannot eat these healthy foods, then our body will eventually sit down. For this, we should always cook and eat healthy food at home.

There are many people in the society who want to spend luxurious life and they have big goals. They are investing more money on different things like cryptocurrency and gold because they know that these could give them profit. Luxurious life is not easy because you have to pay high price bills and you have to give rent of shop and have to pay cost of petrol which will be use by car . First of all , there are three categories of people and these are people who are spending time on many things. Poor people always want be to be rich and for that purpose they are doing investment and they investing money on best things .Middle class people also want to be rich but they are spending more money on useless things and they are looking like rich people.

You may not believe it, but this part is the most important part, even if you want to be rich. You should eat well and sleep in a good house, this is how you give yourself a reward for the hard work you have done. In fact. Even if you just earn money and buy gold or invest in bitcoin or other assets, this will make you disappointed after months or years and this won't work in the long term. Because you have no motivation for your hard work.

We often find ourselves feeling hungry and wanting to be full very quickly. Instinctively we go for some of the easiest source of food to get, and without realizing, we have also conditioned our body to process something of unknown origin. I used to believe i did not have time to cook because we can just buy take away, however, once I learnt a little cooking I realized there is way more satisfaction in catching up to my food. We know exactly what we are eating, all the ingredients, even whether there are spices anywhere.

For me, I think when we choose to go down the path of cooking for ourselves, it makes a statement about who we are, and how we choose to nourish our bodies, that at times we may have overlooked. We do not have to master our learning, we can start with the simple things. Our bodies deserve good care, not just filling our stomachs for a temporary sensation. If we try to eat in the home, eventually our costs will be more sustainable. If we are calmer and calmer about eating, it could be because we know our food is filling and most importantly we know is healthy. All of these claims are not about cooking, but also about how we treat our bodies, with more consideration than less.

This is a great setting for every responsible adult and every young adult that want to build a future. Personally, the emergency, saving and the investment part is the same for me because why do I need to save money when I get invest it in something meaningful and make profit from it, money for emergencies should be separate I get it but money for a new house and investment money would be together, money for emergencies should also count as money to give out to our loved ones (parents, siblings, friends, strangers in need) because we don't just make money to spend it on ourselves alone. Luxury? I only do affordable luxuries.

You are right because after all this hard work, so much income, so much suffering, we need luxury. Those who only work hard and earn an income without any luxury in life live like prisoners behind a concrete wall. We have to give ourselves time, and after working hard, we need a little joy or luxury. These remove our suffering and provide new energy to the body to do something good. Even if we are physically healthy, we need a little luxury to maintain our mental well-being.

It's very important to maintain balance between savings and luxury, i.e.spending money on ourself vs saving money for future. Life is uncertain and we see on daily basis young people with good health die because of different reasons. It's important to enjoy what you have earned rather then saving everything for future. Moreover it's also very important that we don't spend too much money on our luxury so in older age we dont suffer because of lack of money at our disposal.

Let's say you understand and eat by cooking your food, it is a very good thing. You derive a different kind of satisfaction from eating your own food than from buying it. Did you not get this kind of satisfaction by eating food from a store or a restaurant before? You will know the scenario of cooking for yourself beautifully, and when you eat that food, you will be able to eat it with satisfaction.

By eating with satisfaction, you will not have any bad effects on your body. Through this, you will feel good and you are doing what is necessary to keep yourself healthy and strong. By doing this, you will maintain your health and avoid stomach problems. At the end of the day, we want to eat some good food so that we can live in peace. If we can eat with satisfaction, then a different kind of peace can be found in the body.

Well for me I will only spend most of my money on the things that I do need. It is basic living things like my rent, food, and bills to survive. I do not have a emergency fund. But that is something I think I will need to have.

For luxury I do not buy alot of things. If I am going to buy something extra well then it will be more my nephews. Or if it is the holiday season I will buy some thing for my family but I do not have any real luxury items.

I think there is anything i have learned so far from this thread is to no the importance of balancing in ones life where real hard work pulse income are been completely complemented by moments of luxury life and joy i think the key point is that always allows your self time for relaxation and enjoyment which joy and luxury life at the same time can really give positive impact on ones mental health and humility longevity on earth most times the workaholic ones failed to understand that context of break and indulgence which provides new energy and motivation to start again.

Every person in the world wants to move from their current position to a better position. For this, the first thing that should be done is money management. And at the beginning of money management, it is crucial the analyze of income and expenditure. When a person's expenditure is less than his income, then the steps you mentioned will be ideal, not otherwise.

And when a person's income is more than his expenditure, then most people give priority to saving and investing rather than enjoying it. But from my point of view, it is not at all right as you said that a budget should be kept for luxury. Because if we review a little, almost all people in the society die leaving about 70 percent of their earned money unused. So a person must be equally interested or focused on luxury or enjoyment as well as necessary expenses, savings, and investments, which I believe will make him more active in his work.

and if the debt spiral keeps on growing this will probably get worse over time
since cost of living keeps going up but only the salaries of a minor part of the people keep up with it
it's crazy how we simply accept this system instead of looking for alternatives like bitcoin

You're right about that approach, savings is supposed to come first before any other thing. You can't just start paying your necessary expenses after receiving your income, I feel that this isn't the right approach. even if surely we are going to pay those expenses but first of all we have to save and make a proper thinking on how we are going to split it so that it can also cover other things that is already in our budget, Because going with this approach would make us not to achieve most of our plans.

Every adult is supposed to know these things but not all remember to invest. It's easy to spend money but not easy to invest it and this is the most important thing to do. Any money spent on bills and other things is a minus but it doesn't mean that those monies are wasted though, the thing is if you don't have something that generates income for you after a long or short period of time you wouldn't have anything to spend

how can we make it easier to invest?
I know some tricks
- think twice before buying stuff, specially things that are not really needed
- lock your money away investing in things with a bit less liquidity (not all your money, of course)
- pay yourself first
- plan and act on it, be active on your money management

We are all thriving  to have a better life and thats why majority of us will be that looking into something that could possibly give out that kind of opportunity for us to achieve such goals on which of course it wont be that totally normal that you would be thinking up on how you would be starting up yourself on trying out to do things on which you do know that it would be something beneficial for you specially on the future. There's no way that we can be able to tell on what the future looks like but everything will be reflecting into the things that you've been doing and thats why its important that you do have that kind of consideration on wherever you would be spending your money on or simply into something which is more worth rather than on totally wasting it up into things that doesnt bring out that kind of opportunity on making you earn or something beneficial on your part.

Spending up will be entirely be depending be affecting on different ways or various situations on which its not bad on spending up into those things that we do want but it doesnt mean that we would be just that careless on what we are that spending. Everything should be in control and moderation as always on which this is the most important approach no matter what.

I think health is more important than anything because if we are I'll then we cannot enjoy the facilities of life which are giving comfort to us in life . We faced different circumstances in the life and we should be aware of any incident which could be happen at any time, we should prepare for that . OP  highlighted five points but I think there should be more interested point which is health because we should eat healthy things which are healthy for our body.Saving is most important because if you are doing investment with no knowledge then you could be bankrupt at any time and you will be at on the road , so always try to save more money which you can .

Points 1 through 4 are general points that must be applied in our lives to achieve a better future, both for ourselves and for our families, especially children. As they grow older, the costs of education and graduation will increase.

So, after we've created a budget for living expenses, we should set aside money for an emergency fund, savings, and investments. As for point 5, I consider it an additional point that we might not necessarily have every month. However, if it's something as simple as buying a delicious meal at the beginning of payday and sharing it with the family, it will indeed be a luxurious moment that will become a habit that the family looks forward to every payday. This is provided that we have already fulfilled the previous four points.

And luxury is different for everyone. But I prefer to call it pleasure, entertainment, or relaxation. Because as humans, we always need it to keep our moods from getting worse and to keep our minds free from stress. This aspect may seem unimportant, but it's actually quite crucial for mental health, which sometimes requires pleasure.

I totally agree to you on this cause overtime there's this local adage that says "All work and no play make jack a dull boy " this implies that  no matter how busy or studious one can be there's time for fun and play which also adds up to the person wellbeing. So adding leisure as part of the things one can spend money on its fine by me, cause one still needs to allocate money for recreational activities that they derive joy from.

As humans, we live in a very narrow situation, that is why I said that we are completely ignorant about our future. However, it can be said that if we do something good today, we will get a good future in return because the world is like a mirror, if we stand in front of the mirror and smile, we see a smile as a reflection, if we grimace it shows grimace and if we hit, it comes back to us. So if we are careful in our lives, then something good will definitely come out of it. So we should live a moderate life so that the present is good and the future is also good. If we use some part of our income for luxury or to please ourselves, it will strengthen and consolidate our mental state, which will accelerate our work even more.

Relaxation of your mind is extremely important no matter what you do in general in your life, because your brain has to go through a lot of things, and they can disturb you mentally, especially stress, and to deal with that, you need to take occasional breaks from what you do for a living or to make money, and do something that you like doing, even if you have to spend money on it because it's important and it shouldn't be considered a waste of money which some people think of things people do for fun.

Some people gamble, some play sports, and even video games, and they might spend some money on it because they want to make sure they are enjoying the experience. If you love doing something that doesn't cost anything, that's even better, but there is no shame in spending some money on your hobbies or activities after dealing with so much in your life.

That's at least what I do, I spend money on my activities, because they help me relax and calm my mind to be able to deal with all the things once again. If I don't do it, I might give up at one point.

I see leisure as a personal reward for every mile stone achieved and every success level activated. Just has success comes in different levels, I believe leisure too should. Sometimes it mustn't be too big the idea is to stay happy and proud of all the achievement when you look back at how it all began.


While spending on luxury we should also try to keep it within our means. A luxury that will have to cripple our investment portfolio is never worth it at all.  Enjoyment is good same with travel but the impact is only but temporal. Personally I love enjoyment but it should be what I can afford at the moment.

Necessary spending is just be like a compulsory bill that one must consider to pay, for the fact that this are the things that one must get to make life simple and easy for him or her. However, I feel like everything we are spending on are necessary things in our daily life so I think the first option is really compulsory for us.


Although I don’t know if I’m the only one who do normally do this, I normally find it hard to separate emergency funds and savings,  This two things I feel like it the same thing because when I get emergency I normally go to my saving,  so I don’t have any emergency funds they are not different from end though.

Luxury is the time you spend not earning not repaying the debt you are in, plain relaxing some would say is essential but others say not as there is no option that includes excessive time off while still poor and in debt.   Its possible many in the west live in luxury in this way that the majority of working poor elsewhere would not have the option of.

   True luxury I agree is when people have so much money its a task to spend it all and they tend to vastly overpay a premium for usually items seen as unique or special in some way.  Luxury is vital to the economy as invariably some people have too much money so the invention of expensive things is surprisingly essential imo.

There's a level you would need to attain before you can think about spending on your wants. Human desires are insatiable, you can always be pleased with what you have that's why the rich wants to keep on getting richer. If you are someone who's on the come up then spending on your needs would make you go broke. You can only do this when you are financially stable but at a beginning stage it's not a good idea

Whatever is left over after meeting people's basic needs can be saved or invested. However, most people are currently investing in Bitcoin instead of saving money in the bank in the Bitcoin era. However, apart from these five areas of human life, there are several other areas where people spend money, the most important of which is investment. This area of investment can be expanded a little if people reduce their spending on leisure activities. However, for future security, one should reduce the scope of luxurious living and increase the scope of savings and investments, because both savings and investments are very important for the security of a person's future life.

It should be that people should save for the future instead of living an extravagant life. You will see some people behaving in such a way that they are more concerned with the present and spend according to their desires, contrary to their earnings, they live a difficult life at the end of their lives. Yes, there are some needs beyond basic needs but you should set a separate budget for them and plan accordingly. Especially in the case of Bitcoin accumulation, refrain yourself from activities that do not have any negative impact. Along with your physical assets, Bitcoin holding can take you a long way towards future financial stability.

Nothing wrong to indulge in some things that will make you happy every now and then as long as you limit yourself. Do not spend acting like there will be no consequences because time will come and you will realize you have spent all your money and now you are struggling in present time.

Point five often traps people in worse financial situations because they don't properly understand luxury, which is based on accurate income and expenditure.
Instead, people lose the potential to maximize disciplined steps to achieve a better financial level.
If we refer to a small source of income, traveling and eating at a nice restaurant are not the right steps because we have to spend a large amount of money on the costs.
However, if we realize this potential can cost more money, traveling and eating at cheaper places is much better.
People who are building financial strength will not spend more money on things they consider unproductive, even though we know traveling and eating at fancy places occasionally is necessary.

Necessary expenses are a must. The by that I don't not mean buying three $1000 suits or the latest model of ‘some product’ that looks really shiny. By necessary expenses I mean food and clothes, and medicine. Yes, the PS5 can wait. Savings and an emergency fund are totally different. Saving is something that you do every week or probably every month. Emergency fund is something that you put away and don't touch unless it's really an emergency. Saving would one day let you buy a house or a car and the emergency fund is going to make sure that you don't have to wait for someone else's help to stay alive or pay for your medication at the hospital when something terrible happens. Investment is and should be a very big and important part of someone's life because that's how you keep your money rolling and growing. But of course, it will have to invest wisely. I advocate something like the 50/30/20 system, 50% needs (your points 1-2), 20% savings/investments (points 3-4), and 30% wants (point 5).

You're necessary expenses doesn't mean that you buy luxury and buy things that are unnecessary necessary expenses means giving priority to things that are important like food, paying of children's schools fees etc it's important that people give attention to expenses that important and immediate.



There are people who don't give attention to expenses that are necessary at the expense of their investments this is one thing that is not right because investment of any sort takes time before coming to maturity

This, I would say is a good start of spending money based on order of importance. In as much as necessary expenses are fundamental, the purpose of securing emergency funds are important factors as well.
And I think savings and emergency funds can come together with the belief that money should work for you.

How about:

6: Quality. When you are buying things that are necessary or improving your life somehow, it helps if you can go extra mile and read reviews. Those help you determine what items have longer lifecycle and can be upgraded or fixed if needed. Usually those things cost more but they will pay themselves back.

Having a hobby where you need to stretch your body and what rises your heartbeat might help you avoid huge medical bills in the future. Putting money to take care of yourself mentally and physically is an investment for the future. Because if you are not taking care of yourself now, someone has to do that in the future. That will cost you exponentially more.

7: Time. Time is money, and by investing into time i mean investing in planning how to use it. Friends, family, jobs, hobbies, healthy life and rest takes time. And if you want to work for your ambitious dreams to become a reality, you need to find time to make a budget for all of that.

Having a schedule and budget is essential for any plan. It's a way to get your tasks done faster and only way to achieve any bigger goal.

It's not just about raising money. If you end up ruining your health and losing all social contacts, money won't bring that magically back.

This is a great topic, and indeed, in this life, we do need to implement such a system. If we could implement a system like the one you mentioned, it would certainly have the potential to improve our economy, making it progress over time. As you mentioned, healthcare costs are already funded, and everything is allocated accordingly. So, of course, we wouldn't have to worry about the hassles of life if the system you've created were implemented.

I often hear of people experiencing sadness and so on, and this is indeed caused by a lack of financial management and not following rules when receiving a salary, etc.

However, I will add a little, of course, regarding investment. One thing you haven't mentioned is land investment. I believe land investment is equally important, but of course, if we can afford it and our salary is sufficient. I'm sure this topic is very useful, Op.

Land is good investment of you want to invest for long term and you have a lot of money but many people have no big investment because they are doing job and they are running the circuit with that . They could not afford land investment as land is very costly and landlords have more interest in that but middle class people always try to buy a small house for living in which they will spend life and their family will be safe and they have not pay rent to any person. People want to invest in the thing which is cheap but best thing they should save money for the bad time which could be at any time.Thousands of people are trying to be rich and by investment in real estate industry but that industry is looking like flop industry for that couple of years.

All that you have mentioned is very correct and I most commend you for that, you took your time to study life and how to really use our finances effectively, however this last one you mentioned will only happen to rich or wealthy people not average people, if an average person spends money just to eat in a restaurant just because he or she wants to try there food is a very big financial mistake because you are only wasting money, someone will be married and average man still trying to put things together and you will be going out to spend money on big restaurant just because you want to try there food knowing fully well that the food is very expensive, why not cook such food in the house and eat it with your family to safe cost.
An average person can go broke at anytime yes, there are some emergency that will eat up your emergency, reserve and float funds and make you broke and that is why as an average man you need to chanel that money you want to use for luxury life to your investment and become wealthy first before thinking about luxury life.

Middle class people live the worst lives in this world. Because they live in relative poverty but have no opportunity to see it from the outside. For them there are very few ways to improve their lives and investing in land or real estate is very expensive. So from my point of view, Bitcoin is an ideal area of investment. So that they can invest as much as they want and can profit from it in proportion.

Real estate companies have being doing well and not flopping, it could be the people that are trying to be real estate investors without learning are the ones flopping but not the companies. In my country, we're getting more real estate companies being formed because land investing is a big business in my country. Everybody wants to own land and they're looking for ways that it'll be safe to own land hence when the companies are being used for buying by purchasing the land from them, it's safer than when you buy from the individual that might be claiming to be the land owner without you not knowing. Spending money in investing in lands is a good investment and something worth doing because lands are always increasing.

The greatest investment is in yourself, this is something that a lot of people neglect. The more you invest in yourself the more chances you'd get to b in a better position. If you want to get employed and work in that company you are aiming for what are the qualities you possess? What do you know or have that makes you stand out? And more importantly, do you have the necessary skills needed. Self improvement is important

You makes some valid point and I do love those who works on themselves to improve themselves in any place they found themselves. Sincerely, self development or investment as you may say is always important it could be investing in knowing or either skills and of course no sectors or construction companies today that would want to employs a non skilled person in any position today, rather they goes for those with experience and self development or knowledgeable than someone who is not suitable for such positions.

In general, two more categories need to be added to the proposed system, which would make everything very harmonious:

6) Helping loved ones. Often, even if we manage to earn a lot of money, our loved ones are not given the same, so they need help.

7) It is necessary to allocate money for self-education. I mean some courses and books. This will allow you to track prospects and have a broader outlook. Thus, every person, when he lives within these seven categories, will be a developed, calm person with prospects.

For Number 6 that you added I think it is more appropriate with the phrase unexpected funds, this is different from expenses that can be backed up with emergency funds, the calculation of unexpected funds is like sharing or charity or whatever it is that can come suddenly with a relatively small amount.

While the emergency fund is projected for survival size in a few months, so this is not the same and should be added.

For number 7 I agree, even though we are no longer in an educational institution does not mean we do not need to learn, continue to upgrade ourselves to become a much better person than yesterday.

I think 6 and 7 are good additions to the list
it's always good to help the family if you don't expect anything in return and self-actualization is a must, even though we aren't in schools anymore we need to keep studying and learning otherwise what is the point? learning is one of my biggest motivations in life. experiencing things I haven't experienced before.