subject: Personal Wealth Building Bucket Program For Cash Managing And Wealth Building [print this page] Personal wealth building entails trying to stop leaving from one paycheck to another month's paycheck. It is quite common to see people who strive to leave something behind after receiving their salaries but their efforts always seem to yield no result despite the periodic increases they get and great effort they put in spending within their budget.
There is personal wealth building program called Bucket Program. This unique program promotes some nice habit such as paying ones self first while plowing back the entire excess cash flow into avenues that would keep building wealth and ensuring more stable financial future.
At the initial stage of the bucket program, four different buckets are named and they all represent different categories of financial dealings that are funded by steady and consistent percentages of an individual regular income that are usually directed to your personal wealth building goals.
A. The first bucket is the account in which all the earnings and incoming monies are deposited most probably through direct cash and monetary deposit to make up the sum of what you are earning each month or any other given time.
From this bucket, some percentage of the income is usually withdrawn and deposited into the other three personal wealth building buckets. You are advised to try and live below 70 percent of your income per month so that the remaining fraction will be deposited in the three buckets listed below.
B. The second personal wealth building bucket is the one that is termed 'Pay Your Self' bucket. This should receive at least 10 percent of your disposable income and may not necessarily serve as a long term cash amount savings but the kind of money that is kept aside for any emergency or the next crisis.
This account also serves as a kind of back up to the working capital. It is a sort of fall back that would be needed if there is any need for emergency fund. It helps to reduce the pressure that is usually mounted on your working capital because there are certain expenditures you can easily sort of from this bucket.
C. The third personal wealth building bucket should also receive at lest 10 percent of your disposable income. The amount you set aside for this account could be flexible depending on the goal of the account. In many cases, this account is used to accumulate funds into other sub-accounts created for certain special needs.
D. The fourth personal wealth building bucket is usually created to be used in keeping track of your contributions. It is also used for organizing your wealth creation activities. It is usual to also have at least 10% of the funds in this very operating account transferred to this account on monthly basis.
This account plays vital role in the entire process because it usually serves as the watch-dog account that could be used to boost any of the other two that might be falling short of expectation. You may find it hard to set large sums aside for each of these accounts but the most important thing is for you to start with any regular amount you can sacrifice.
