How to Manage Your Money

Photo from

Photo from

When I was in the youth camp, one of the pastors approached me and asked me how I was. He is Bro. Danny Latoza. He is the camp dean and one of the professors I had when I was still a camper. I told him that I’m now working in a public school and it has been okay so far. He asked me if I already have savings and you know what? For the past five years I have been working, I only get to start saving money last year. Anyway, with the conversation we had, I felt like I had a Financial Management class again but I’m now planning to apply the principles I learned from him.

So, there are four phases in our life…

  • Education Phase – This is the first 20 years of our life where we go to school, earn a diploma and prepare ourselves for the second phase.
  • Employment PhaseΒ (20 to 40 years old) – This is where I am right now. I’m just starting and somehow still enthusiastic going to work but he said, as time goes by, I’ll get tired of it which will lead me to the third phase.
  • Entrepreneur Phase (40 to 60 years old) – At this point, we already want to be the one on top or the boss. We want to have our own people and take hold of our time.
  • Retirement Phase (60 and above) – The time where we just enjoy the fruit of what we’ve worked for from the second and third phase.

We will have a better third and last phase if we will use our money right…

The four uses of money…

  1. To spend. Well, of course! We use it to have our own wants and needs.
  2. To save. This is where we get confused sometimes. For example, if we want a new smartphone, we will save (or loan) money until it’s enough to purchase the one we like. This is not saving. It’s still spending.
  3. To give. I actually believe that what we give will return to us in different forms. It might not be from the same people we have given it to but when the time comes we are in need, we know God will also use other people to help us.
  4. To invest. Don’t just keep it, make it grow.

The division of salary…

The 70/30 Principle

10% will be for the Lord (tithes). We might not have the same faith but for the record, this really works for me. My wallet is never empty because God really provides.

20% will go to your savings.

70%Β is for you to spend (and give). Adjust your lifestyle to 70% of your monthly salary. It sounds hard, right? But just calculate how much you will be saving in a year or in ten years. That’s a lot of money!

Bro. Danny doesn’t have a high income as a pastor but he is not poor. He is able to provide what he wants for his family. He is also able to help a lot of people and even support some of them in college. He lives by this principle. I can do that, too!

A rich man is not the one who has the most but the one who needs the least.

It’s not how much your income is, it’s the way you manage it. πŸ™‚


7 thoughts on “How to Manage Your Money

  1. Liz Kibby says:

    Interesting and informative. The only thing for me is, I began working at 15 and I was in the entrepreneur phase only a year or two later! I was surprised to see most people don’t reach this until they are 40. So crazy to me! I enjoyed the piece.


      • Liz Kibby says:

        Some people are more inclined, but it was interesting to find out that others get there too at some point. Sometimes I get frustrated when I feel like the only one. πŸ™‚ Thanks for the article.


  2. amforte66 says:

    Wow, that is really interesting. I never heard about the phases before. That’s great that you have someone who will tell you all of these things, and even better, that you listen! I really enjoyed this. πŸ™‚


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