What is the Minimum Amount We Need to Earn?
What is the Minimum Amount We Need to Earn: The money we need to earn, friends, there is absolutely no need to say that for us to live a better life, how important it is for us to have enough money, and we have money according to our needs, for this it is very important that we Save the money you earn.
“We all earn money, but we do not know exactly how much money is very important for us to earn at least so that we can save and invest money”
So in today’s topic, we will discuss what should be our minimum income, and how we can save money so that we can fulfill all our financial goals by investing better with the savings money.
Let us first know that – how much money we need to earn at least.
How much minimum money do we need to earn? To answer this question correctly, first of all, we have to understand how our money is spent.
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We have to spend mainly two types of money from our money – one which is our basic needs and other wishes,
Let us understand it in some detail-
Basic needs – like house ration, house rent or EMI, light bill, water bill, phone bill, newspaper bill, TV bill, and any kind of loan installment and medical medicines and others, Our Wishes – Like new household items, new TV, furniture, new mobile, new clothes, and other things.
Friends, the circumstances of all of our lives are completely different, in such a situation there may be a slight difference between the basic needs of all of us and our desires, but most of the common man spends his earnings only on fulfilling his needs and his desires.
Earn at least how much
Now in such a situation, if you want to know what should be your minimum earnings, then first of all you have to find out what is your basic need.
Basic needs like – House Ration, House Rent or EMI, Light Bill, Water Bill, Phone Bill, Newspaper Bill, TV Will, and any kind of loan installment and medical medicines, children’s education fees, and other expenses,
Once you understand what is your basic need, then you can easily know what should be your minimum income.
Minimum Earnings = Basic Expenses x 2
i.e. your minimum income should be double your total basic requirement,
Like – Suppose your total basic requirement is 15 thousand per month, then your minimum income should be, double of it i.e. 30 thousand.
MONEY WE NEED TO EARN
Let us now know why do we need to earn twice as much as our basic needs.
We all want to live a better life, and for a better life, it is not enough to fulfill only the basic needs, we have our wishes, our dreams, and many other such expenses, which we have to do to improve our lifestyle. ,
If we are able to save 50% of our total income after meeting our basic needs, then we can spend 30% of our total income on other wants, desires, and goods and services to improve our standard of living,
In this way, we can plan to spend our total income in this way-
Net Income – Rs.100
Expenses – Basic needs = 50%, and other living standards and other needs = 30%
In this way, if our income is Rs 100, then we can spend Rs 50 on basic needs, and spend 30% on other types of desires, needs,
And still, you have 20% of your total income, you are able to save,
You can invest this 20% saved money diversified according to your risk appetite keeping in mind your different financial goals.
HOW MUCH MONEY DO WE NEED TO EARN: SUMMARY
Let us SUM UP our talk-
- Our minimum income should be double our total basic needs,
- 50% of our total income should be spent on basic needs,
- 30% of our total income should be spent on our second-level needs,
- 20% of our gross income should be saved and invested to meet our short-term and long-term financial goals,
If your income is double your basic requirement, then you can plan your spending and savings in the ratio of 50 – 30 – 20.
And if your income is less than double your basic needs, it can be very difficult for you to live a better life and save, Therefore, first of all, you have to think that in whatever situation you are in today, how can you double your income for your basic needs, maybe – you have to cut some of your expenses, as well as your income. Think about how to grow, and do your full 100% first of all for the fact that your MONTHLY INCOME becomes DOUBLE with your MONTHLY BASIC EXPENSES,
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