- The Living Arm of money is the path most of us know about intimately. It is where all the expenses are located and it usually takes up 110% of our income. Yep, we spend beyond our means in this category.
- The Saving Arm of money is the least known path for Americans. We really stink at saving money. The Chinese and Japanese so have us beat in this area! Of the entire US Population, only 2% saves money. Yikes!
- The Giving Arm of money is actually well done by Americans. We are a very giving country, but the reason we don’t benefit like we could by this movement of money is due to our inconsistency of giving. We donate here, there and everywhere, but in a very sporadic way. This does not help keep the flow of money going. Consistency is the key here.
To get money moving in your life you need to have cash flowing to all three arms of money at the same time. That is why it is impossible to pay off your debt first and THEN save money. You must save money and pay off your debt at the SAME time.
Now that you know how money flows, you’ll be able to use that knowledge to funnel cash into the areas of your life that will bring a return. The next post will deal with the actual mechanics (read: details) of how to make that happen. Step 9 to Abundance is the 60/40 Principle!