Dr. Oz: The 50-30-20 Rule
Dr. Oz has been talking to Tiffany, a woman who has a lot of money anxiety, and financial expert Manisha Thakor, who says the root of money anxiety has nothing to do with money. It’s all about living from authentic joy and making sure your money spending is in line with your goals and values.
Manisha recommended the 50-30-20 Rule, which says that 50 percent of your income should go toward your needs, 30 percent towards wants, and 20 percent towards savings. Manisha said that needs includes things like housing, transportation, food, insurance, child care, and debt payments. The wants include things like beauty regimen, clothes, drinks out with friends, coffees, and other fun stuff. Savings includes things like emergency fund and money for the future and retirement.
Dr. Oz: Avoid the “Shoulds”
Manisha said we should avoid the “shoulds”. These include all the things we feel pressure to do externally, like clothes we buy, cars we drive, or where we take our vacation. The way to turn it around is to ask yourself if it truly brings you authentic joy. And if it doesn’t, it’s a “should” and you can cut it out.
Tiffany said one of the things she should cut out are eating out as much as they do.
Dr. Oz: Be Clear About Your Finances
The last step is to be clear about your finances. This means that you need to be clear with yourself about what your household income is and what your household expenses are. If your expenses match your income and there’s nothing left over for savings, that’s a red flag that you’re out of balance.
You need to look at external validation and what really lights you up in your soul. If you want a big house, is it because you feel like you should have one? Or is it because you need one? Can you afford one? These are important questions.