Hello, everyone and welcome back to a new video, sean's name and budgeting is the game. Today. Now i hate the word budget because nobody wants the budget friendly version versus the luxury version of literally anything, but to get to that luxury baller status. It all starts with a good budget and, more importantly, how you manage your money now to have lots more of it later.

So that's why today i want to be going over exactly how i manage and budget my money so that my money can make me money with every single paycheck that i get and we're not talking about the 80 20 rules or the 50 30 20 rules, because Those are way too mainstream one's complicated one simple, but neither of them go the extra mile, which is really what's required if you want to get ahead of the guy sitting next to you so without further ado, let's jump into my 60-41 rule on how to go From budgeting to living a very luxurious lifestyle, let's do it, okay, so for those of you who don't know, i do not come from money at all. I come from a very lower to middle class family, where i pretty much built up everything that i have today. All on my own, which, by the way, is all thanks to the 6041 rule that we're going to be going over today, and i need to mention that this 6041 rule is not going to be easy. It is going to challenge you financially every single day of your life, it's a constant goal and that's the important part of this entire video.

It is a goal: okay, you challenge yourself, physically, emotionally, spiritually, etc every single day to make yourself a better person, but most people don't challenge themselves financially to do the same without a challenge of constantly pushing yourself. You're never going to get better and same thing applies when it comes to finances, if you're not constantly pushing yourself, financially, you're never going to get wealthier, and also, if i don't blow your mind by the end of this video i'd, be a little shocked, because this 60 41 rule comes around full circle and it's super cool. So you definitely want to wait to the end of this video okay. So let's do it first hit that, like button second you're now wealthy you're welcome and thanks for watching all right just kidding.

So, let's break down this 6041 rule to start on how you can manage your money and then we're gon na go through a real life example. So it looks like this. Sixty percent of your income goes towards your needs and your wants we're talking things like housing. So your mortgage or rent your utilities, your food, your gas, your clothes, etc, literally, anything that you need or want in your life.

It's money you spend on your day to day that's 60 of your income, then 41 of your income goes towards your non-negotiables. We're talking things like savings, paying down debt, investing whether it's stocks, bonds 401k real estate, whatever this is the challenge that i was talking about earlier in the video that's going to challenge you every single day, because it's gon na be hard and if you're sitting there, Like uh sean that equals 101 percent dog, like aren't you supposed to be this finance guy, you can't even add two numbers together. What the dude well remember when i said that all budgeting rules do not go the extra mile. Well, this one does that extra one percent is reminding you every single day that you need to get off your butt go out there and make an additional one percent of income that is not coming from your regular job.

I'm talking about side, hustles or something you can do in your free time to generate a little extra money, and this doesn't have to be some crazy, self-employed, massive next facebook, amazon business that eats up all of your time. No i'm talking about something very simple: that's not gon na eat up a whole bunch of time, and it's gon na make you a little bit of extra money every year and one percent is absolutely nothing for most people, that's less than a thousand dollars a year. The simplest things can generate you a thousand dollars if you had 365 days out of the year to do it, i mean like mowing lawns: washing cars, ubering, helping a friend move heck a dang lemonade sand could probably generate you a thousand dollars. If you had a year to do it, and if you do it right, i mean it's: it's really not that hard sad part is just most.

People are too lazy and once they're done working at their day job, they don't want to think about anything else. They want to sit their butt on the couch and watch netflix all day which, if that's what you want to do totally cool you do that. But for me, that's not enough for me all right and if you're kind of sitting there like well, i don't want to go wash cars or eliminate sand or all those things. I have so many videos and so many ideas on what you can do to generate a little extra cash.

I've got some videos linked down below on some great side, hustles or maybe some great jobs. You can work remotely from whenever you kind of want. So, there's definitely no excuse on how to generate that thousand dollars extra a year. It's more so just you putting in the effort to do it and most people don't even make a hundred thousand dollars a year, so they won't need to make a thousand dollars extra.

When they do their side, hustle, it's gon na be more like 500 to 700, which is even easier either way. I want to mention real quick that this 6041 rule is really meant for people under the age of 50 and who are kind of considered in grind mode once you're over the age of 50. Most people are kind of thinking about retirement at that point and they no longer kind of want to spend their money as frugally as the 60 41 rule or get off their butt to go make an extra one percent. You know you've been working for probably 30 years at this point at least 30 years um, so it's not really designed for people over the age of 50, more so under the age of 50 and really designed for people in their 20s to 30s.

But all right. So that's the rule. It's simple! It's very easy to understand. Now, let's apply a real world example with income and expenditures to realize just how challenging it can be to live your life this way, so let's say you net sixty thousand dollars a year, which is a phenomenal net income by the way, all right, we're gon na, Be focusing on net income? That's the important part, not your gross! Your gross is gon na, be what you make before taxes, medicare or any type of deductions.

Your net is what you actually take home. Oh - and this is just some super basic budget template thingy. I found on excel um just use whatever template or make your own that you want, and then i urge you to go through your bank statements to see what categories you actually spend money on every single month, but getting back to the example. Okay, let's say you net sixty thousand dollars a year.

That means you've got thirty six thousand dollars a year or three thousand dollars a month to live off of, because that's sixty percent of your income. Now, let's say your rent mortgage is fifteen hundred dollars a month. Utilities are 290, food is 500, gas is 100, entertainment, stuff is 100 and you know some new clothes or whatever are 100, and then i always have an other category for random purchases. You'll make in a month that you can never plan for, like every single run, to target that these ladies like to make - and i put that for the rest of our budget so 410 again, you clearly will be creating your own budget, as i just made up Those numbers literally off the top of my head, but then next you'll have your non-negotiable.

Savings is usually the first thing. You'll probably want to fill up, even though i kind of do it all evenly, but it's totally up to you and how you want to do it on your non-negotiables. Most people want that safety cushion first before they start investing. But again i fill them all up evenly.

You do you, but typically you do not need more than six to twelve months of savings built up in liquid cash as we just determined. We should only be spending three thousand dollars a month, so that means we need. Eighteen thousand to thirty six thousand dollars in our savings before we no longer want to put a single penny in that category. So, let's just say we throw 700 a month into our savings.

Then we've got a car payment that we're trying to pay down and some student loans or whatever so we're going to throw another 850 into that each month, then, between our investment accounts and or our 401k or whatever, we've got we're going to put another 400 into That and i actually always do an other category on this section as well, and these are things for maybe like a craigslist flip or some cool investment opportunity that pops up - and you know whatever you want it for, but i like to keep a little bit of A cushion in there in case something cool comes up so between the two that's five thousand and fifty dollars a month which equals sixty thousand six hundred dollars a year, which is our income plus our one percent boom. Literally that simple to figure out and to do. But now i want to show you how effective this can be. So let's say you started doing this by the age of 20 and let's say something else, which is absolutely unreal.

But let's say your income stayed the exact same at sixty thousand dollars a year for your entire life, which is basically like impossible. But by doing this you're going to be 100 debt free all right, you're gon na have enough money in your savings account for reserves. In case any emergency happens and you're going to have a very, very, very minimum of 491 235 dollars in your investments by the time, you're 50 years old. Again, that's legit! If you never ever got a pay raise ever half a million dollars by the age of 50 on the mega conservative side.

Are you following me? So if you relook at the budget when you're 50, that means you no longer need to save any money, because you have a hefty savings built up. You no longer need to pay down debt because you should be debt free by this point and if you want, you can keep adding to your investing or you can take that freed up cash and do more with your life and again this example is super rudimentary Right, we're not taking into account the cost of living rising or your pay raise, is increasing or you going through a life crisis or literally anything like that debt fluctuations. I mean there's so many other variables that come into play, but i want to keep this as simple as possible, so you can understand it before you kind of go out and actually try it for yourself. It's super basic.

All you have to worry about is only spending sixty percent of your income, generating that extra one percent every year and the rest is going to fall into place automatically, and will this 60-41 rule make you incredibly wealthy? No, no! It's not i'd be lying to you. If i told you it was your income is going to make you incredibly wealthy, but this helps you manage your income, so you don't have to work for the rest of your life. Retirement is actually attainable at a younger age. With this strategy and again, the biggest thing is not having to stress about your monthly expenses or anything financially related.

I was cut off from my parents financially around the age of 16, 17 years old, and let me tell you financial stress, absolutely sucks. Alright, it challenges your relationships, it ages, you quickly and it ultimately just makes your life miserable, but i will say that it does teach you the true value of money when you're at that point, because by the age of 20, i've basically become financially stress-free and have Never had to worry about. Am i going to have enough money to fill up my gas tank to go. Get food to go.

Do the certain day-to-day things that i did otherwise stress about when i was younger and again it's all thanks to the 60-41 rule. It might look like it could be something easy and it's a very basic concept, but it's very challenging to do it day in and day out, and i just want to say it started as a goal for me and kind of turned into a lifestyle. And i promise you, it is totally worth it again. I bit the bullet when i was younger to live that budget lifestyle.

So now that i can live the luxury lifestyle, but since you've made it this far in the video, i want to bring this all full circle for you. So comment down below what 60 of your net income again important, that it's your net income 60 of your net income down below. In the comments? That's how much you need to live off of every single month! And when you comment it you're probably going to be sitting there going holy crap, i'm going to be eating ramen for the rest of my life, because this is an obscenely small amount of money. But as i've mentioned throughout this entire video, the 6041 rule is a goal you catch that goal: g-o-a-l 60-41.

Okay, sometimes we reach our goals and sometimes we fall short, but we always need to be striving to do better. We do it with every other aspect of our life, so why not financially, but that's the 60 41 rule. It's changed my life. Hopefully it could change yours too, and now it's probably a good time to mention that 79 of the world's population lives paycheck to paycheck.

With zero plan for retirement at all, so if you found this video helpful, i would really appreciate it if you could share it with a friend or a family member or anyone you hold dear, because what's the point of being financially stress, free and out there doing All the fun stuff, when the people you want to do with can't do it, instead of giving them a fish, give them a rod, so they can reel them in with you either way. I hope you enjoyed the video if you did please hit that like button subscribe for more content like this, i'm always trying to release some great content to put you ahead of the guy sitting. Next to you, so i appreciate you watching my video and i will see you in the next one. You.