Strategic Budgeting: Planning for Success With 20/6/3
Are you looking to maximize your savings, profits, or both? As a business owner myself, I have come up with a simple, yet extremely effective way to build wealth. It is a great starting off point. I call it my 20/6/3 plan. The 20/6/3 Plan is a simple yet effective way to get your finances back on track. With this plan, you’ll save 20%, build a six-month emergency fund, and carry consumer debt of three years or less. This strategy will help you save for retirement, keep an emergency fund that can be used in times of need and prohibit yourself from taking on more debt than necessary while achieving your goals.
20/6/3 is a plan to help you save money, maximize savings, and minimize efforts
20/6/3 is a simple yet effective plan to help you save money and become financially stable. The 20% savings refers to putting away 20% of your income into savings each month. This may seem like a lot, but it can quickly add up. The 6-month emergency fund is for those unexpected expenses that always seem to pop up. Having this buffer will help you avoid going into debt when something unexpected comes up. The 3 years or less in consumer debt is self-explanatory -the goal is to pay off any consumer debt you have in 3 years or less. This may seem like a daunting task, but it is definitely achievable with some discipline and effort.
Entrepreneurs: Follow these steps and you’ll be on your way to financial freedom
There are a number of strategies that entrepreneurs and business owners can use to maximize their savings, reduce their taxes, and minimize their expenses. One important strategy is to take advantage of tax breaks for businesses. These tax breaks can save businesses a significant amount of money, but they require careful planning in order to maximize their benefits. Another strategy is to carefully monitor expenses and to look for ways to reduce unnecessary costs. This can be challenging, but it is essential for businesses to control their expenses in order to be profitable. Finally, businesses should take advantage of financial planning opportunities that can help them save money and grow their business. By carefully implementing these strategies, businesses can save a significant amount of money and improve their bottom line.
There are a number of strategies that can be used to save money. The simplest way is to save more than you spend. The 20/6/3 ensures that you are doing this. Beyond this, business owners have significant opportunities to reduce taxes and minimize expenses. However, it is important to carefully consider each strategy before implementing it. This will ensure that you maximize your savings. Implementing these strategies can help you achieve financial stability and reach your financial goals.
Take the Next Step
For more information and tips on how to achieve this goal, book a consultation today! We can help you create a savings plan that works best for you so that you can maximize your money for thefuture. While the 20/6/3 is an effective tool, there are more ideas such as Solo 401K’s, HRAs, adding a spouse to the business so you can claim the Child Care Credit, and more ways to help you achieve your goals faster.
Matt Ward, CFP®