How To Put The 100% Personal Tax Into Practice

I’ve written about the idea of a 100% personal tax, which is the idea that whenever you buy something that isn’t a necessity, you impose a 100% tax on yourself that goes toward your savings account. This is a forced savings tactic which helps put your spending in perspective. If you have a difficult time saving and you think you spend too much, consider imposing a personal tax on yourself, whether it’s 50%, 75%, or 100%.

The Problem With a Personal Tax

One complaint I’ve seen about the personal tax is that is forces us to transfer money from a checking account into a savings account after each purchase. If we wait until the end of the month, the money might be already spent and it might be impractical to make a large transfer. If the money is left over at the end of the month, you probably don’t have a savings problem, anyway.

The Personal Tax Solution

Well, there’s a perfect solution to this problem, SavedPlus. It’s a site (and Android and Apple apps) that lets you set up automatic transfers from your checking account to your savings account for each purpose. There are a ton of customizable settings, and within a few minutes you can see how flexible SavedPlus can be to fit your lifestyle and savings goals.

Some of the great features include:

  • Control the percentage of each purchase that gets transferred
  • You can set a maximum purchase amount (won’t transfer for large purchases)
  • Pause automatic transfers for a scheduled amount of time (great for vacations)
  • Set a minimum checking account balance (so you don’t transfer too much out of your account)

Challenge Yourself

If you’re having trouble saving each month and want to do a better job saving for a rainy day, for a vacation, or long-term goals, check out SavedPlus and consider using a personal tax. Start at 10%, and if you can, try to increase the savings percentage each month.

4 Responses to How To Put The 100% Personal Tax Into Practice

  1. We automatically put away money for savings, income taxes, and property taxes from every pay period. That way, we know we only have what’s left to spend to cover our normal bills plus the extras. It makes it much easier for us overall. But this method sounds like it would be great for anyone breaking bad spending habits. :-)

  2. Hello Daniel,

    This seems like a great idea to me! I’m not exactly the shopaholic type, although I can be a bit of an impulsive buyer sometimes. I think this can help me control that and also help me save some money at the same time. Thanks for sharing this wonderful app!

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