Financial obligations are going to stay happily married to you irrespective of how you feel. They’re gonna be like “I love you so much and will never let you go, no matter what?”

You either choose to reciprocate the love or you can just stop breathing. Seeing as you love your life and would love to continue breathing, it’s best you learn to handle your financial obligations affectionately by organizing your budget. You can use this free money management tool which makes it really easy to build an organized budget.

Aside from organizing your budget, the sort of financial obligations you give yourself plays a huge role in your financial health.



Every effective budget should have three main categories.

  • Essentials or your needs – 50% of your monthly income
  • Non-essentials or your wants – 30% of your monthly income
  • Savings for financial goals – 20% of your monthly income.

You can take a look at our blog post about the 50/30/20 budgeting system to help you understand more about the different categories in budgeting and why it is so important to pay yourself first every time you receive your monthly payments.


According to the 50/30/20 rule of budgeting, you should spend 20% of your paycheck on your financial obligations. These are expenses that are mostly future-oriented.

Financial obligations include these 4 items:

  • Savings Goals
  • Retirement
  • Debt Payment
  • Emergency Funds

Let’s elaborate more on these.


Leading the list of items you should have on your financial obligations list is your savings. I don’t know if you’ve noticed, but not a lot of people are into saving, and that explains why a lot of people are screwed financially. As a matter of fact, 65% of Americans, mostly millennials, save little or nothing.

What’s going to happen if you don’t have any savings?

  • You’ll be more likely to spend on impulse and probably feel guilty for doing that later on
  • You may not be able to add value to yourself like further your education, start a business, invest, etc
  • What about a little bit of fun every now and then? You may not readily afford a vacation but you can save money towards for that.

Find out everything you need to know about opening a savings account ASAP and start saving. Your future self is going to thank you for it.


You don’t want to depend on social security to cover all your retirement expenses by the time you retire. That’s a bit too reckless. You also don’t want to depend on your family to take care of you at old age. That’s not fair. Saving for retirement while you’re still young and working can guarantee you a stress-free future.

You can open an IRA (Individual Retirement Account) in no time and start saving for retirement right away.

One more thing, you don’t want to set up your IRA just like that because there are some cool practices you can apply that’ll certainly boost your IRA account.


A whopping 80% of Americans are in debt!  So, you’re definitely not alone in this. One great way to pay off your debts and maybe join the 20% of Americans that are not in debt is by making it a financial obligation every month.

What’s going to happen if you don’t pay off your debts?

  • Your debts will go to a collection agency
  • Collectors will contact you
  • They’ll pressure you and even sue you
  • Your credit score will suffer

While you’re putting money aside to clear your debts, you can also renegotiate your debt for reduction.


Stuff happens when you least expect it. You may need to fix your car, visit the hospital, or replace a broken window in your house. It is always important to make plans for emergencies should they arise or you may be forced to go into debt.

Just like your retirement account, you can also invest your savings funds. Don’t even think about Forex or stocks! There are other safer investment options to consider. Some of them are:

  • Money market account
  • Treasury bills
  • Roth IRA

Be sure to consult your financial planner before making any move.

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