90-10 Rule

I love the movie Hitch. It isn’t quite in my top ten but it is a fun movie to watch. One of my favorite parts is when Albert (Kevin James) is being coached by Hitch (Will Smith) on how to approach his girlfriend, Allegra on the step for a kiss. Hitch tells Albert to go 90% of the way in approaching her and let Allegra go the next 10%. In an awkward demonstration Hitch pretends to be Allegra and Albert, who must not know the difference between 90% and 100% leans forward and kisses Hitch…Its pretty funny. I have my own 90-10 rule but it has nothing to do with Hitch.

I read once that when trying to save that we should pay ourselves/invest 10% of our traditional income and live off 90%. Taking that a step farther we should invest 90% of our supplementary or side income while spending only 10%. I know it sounds pretty extreme but this is definitely something to try! I have been following this principle for the past few years and it has helped our finances immensely. We have been able to save money that we wouldn’t miss in the first place. Plus knowing that we are putting these amounts away helps me to relax about the other $$$ we are spending. You should try it!

Something to note:

I know that life can come at us hard sometimes. If things are a bit tight my rule turns to the 95-5 rule, investing only 5% of my income and possibly less of my supplementary income. The key is to get back on track when things start to ease up again. Either way keeping the principle of storing away a good majority of my side income and some of my primary income has been a great help.