It is undeniable, managing financial is often become a challenge, because you have to be good at dividing income for several purposes such as paying home payments, children's school fees, monthly spending, electricity and water bills, insurance, to optional costs such as traveling or buying gadgets, and of course saving.

Generally, the problem is that many people do not understand how much money must be budgeted for these needs. In the science of financial management, there is a simple formula that can facilitate you in managing financial. In a book All Your Worth: The Ultimate Lifetime Money Plan, US senator Elizabeth Warren introduces the 50/30/20 formula. The formula divides your after-tax income and allocates it to three items.

50% of your income goes to expenditure post. Then, 30% goes to needs post, while the remaining 20% goes to saving or investment. This formula does seem simple and easy to apply. However, in practice, you may experience difficulties.

To get started, you need to be able to distinguish which expenses need. In this case, find out in detail what your expenses are and what items you really need. The 50/30/20 formula is a good guide for your financial, but it must still be supported by good financial planning.

Viewed from the perspective of long-term financial planning, discipline in financial plan is very important. However, allocating some money to get entertainment is also important. Not only that, ensuring your health and family is also very important. This can be applied by paying insurance or setting aside money as an investment instrument and pension fund.

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