The Ultimate Lifetime Money Plan -Elizabeth Warren & Amelia Warren Tyagi

This book is for anyone who wants control of his or her money, once and for all.
All Your Worth is a plan for life.

The book consists of practical advice regarding money and it may be useful for people who are unable to implement a budget or cannot track their money diligently.

The authors have discussed the following 6 Steps to a Lifetime of Riches

Step One: Count All Your Worth

All Your Worth balances your money into these three categories: Your Must-Haves (the things you need) ,Your Savings (the money you save) Your Wants (the stuff that’s just for fun).

Balancing your money is the key to having enough.

If you aren’t saving enough it is because you are spending too much on your Wants or your Must-Haves (or both).

The Balanced Money Formula

Your Budget should be divided into
Must-Haves: 50%
Wants: 30%
Savings: 20%
But I would recommend
Must-Haves: 50%
Savings: 30%
Wants: 20%

You can spend your Wants money on anything that strikes your fancy, so long as you stay within 20-30% of your income.

If you are still unable to maintain your Money Remember your mama’s advice: Just do your best.

Step Two: Escape from the Thinking Traps

If you feel the tug of a negative-thinking trap, follow 3 steps:

  1. Identify the trap
  2. Remember your goals. You are clear about your goals: You want to get straight with your money, to stop the worry and get on the path to a richer life.
  3. Put up a fight

Step Three: Count the Dollars, Not the Pennies

Savvy money managers start with the dollars, not the pennies.
Don’t sign long-term contracts for things that aren’t absolutely essential.

Step Four: If You Can’t Afford Fun, You Can’t Afford Your Life

When your money is in balance, you always have enough to pay your bills, have some fun, and save for your dreams.

Step Five: To Build Your Future, Pay Off Your Past

Make a promise to improve things as much as you can, all by yourself.

Step Six: Build Your Dreams a Little at a Time

The first piece is your retirement fund. The second piece is paying off your house. And the third piece is saving for your other dreams. Just those three pieces, and you have the formula for building wealth, securing your future, and making your dreams a reality.

The very advantage of having a Money Plan thought and implemented leads us to “No matter how bad things get, I always have options.”

Overall this book is must read for newbie and moderately financially savvy person who find it difficult to plan their Money. The only important takeaway from this book is the Balanced Money Formula.