How to Stop Living Paycheck to Paycheck with the 10-20-70 Rule

A young Filipino woman sits at a wooden table with a notebook, pen, and laptop, organizing her salary into three jars or envelopes that represent the 10-20-70 rule for budgeting — 10% giving, 20% saving and investing, and 70% for expenses. The scene has soft natural light, creating a calm and empowering atmosphere about smart money management.


Most people work hard for their money. But the truth is, only a few know how to make their money work for them.

Every payday, we pay everyone else first: the bills, the loans, the groceries… and if there’s anything left, saka lang mag-iipon.

But here’s the secret that wealthy people live by: you should pay yourself first.


What “Pay Yourself First” Really Means

Paying yourself first means treating savings and investments as a priority, not an afterthought.

It’s about setting aside money for your future before you spend on everything else...not waiting “kung ano ang matira.”

When you do this consistently, you start building financial security without even realizing it.


The 10-20-70 Rule (Also Known as the Abundance Formula)

To make this habit easier, use the 10-20-70 Rule popularized by Bo Sanchez — a simple and practical guide to managing your income with purpose.

✅ 10% — Give Back (Tithe or Generosity Fund)

Money has meaning when it’s shared. Give back to your church, community, or causes close to your heart.

Generosity keeps you grounded and reminds you that money is a tool for good — not just for spending.

✅ 20% — Save and Invest

This is the “Pay Yourself First” portion.

Before spending a single peso, move 20% of your income to a separate account for:

  • Emergency savings
  • Insurance/protection plan
  • Long-term healthcare
  • Investments (mutual funds, stocks, etc.)

💡 Tip: Automate this step. Transfer savings right after you receive your salary — don’t wait until the end of the month. If you wait, chances are, nothing will be left.

✅ 70% — Expenses

This covers everything else:

  • Bills and utilities
  • Groceries and food
  • Debt payments
  • Transportation
  • Short-term healthcare
  • Daily living costs

If you find that your 70% isn’t enough, don’t cut your savings — adjust your spending instead. Remember: Expenses should adjust to your savings, not the other way around.


Why This Formula Works

Once you get used to this rhythm, you’ll realize something powerful — the 10-20-70 rule actually changes how you see money.

The 10-20-70 rule helps you:

  • Create balance between giving, saving, and spending.
  • Reduce stress because you’re no longer living paycheck to paycheck.
  • Build long-term wealth one disciplined habit at a time.

It’s not just about math. It’s about mindset — choosing to value your future more than instant gratification.


Final Thoughts

You don’t need to earn millions to start building wealth. You just need to manage what you have wisely.

The 10-20-70 Rule gives you a simple structure to do that.

So on your next payday, before you pay your bills or shop online, pause and ask yourself:

“Have I paid myself first?”

True abundance doesn’t begin when you earn more. It begins when you learn to handle what you already have.

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