Financial Management – The 5 Jar Method [Infographic]

Everyone’s got financial difficulties.. well, most of us do anyways.

But what is it that successful people do to get out of ‘the rat race’? farm seed soil grow wealth money coin

This may be a question you’ve been pondering for a while, or maybe it’s a brand new thought, either way this article and the infographic below is designed to answer that question (and provide you with other excellent studying resources to study at your leisure).

This is called the 5 Jar Method, and it’s based off of Biblical principles, if you’re non-religious, then please don’t let that throw you off, these are practical guidelines that are timeless and have been passed down from generation to generation.

Before going much further, I just want to give further credit to Craig Hill who does a show called Ancient Paths, where I first learned about these Scriptural principles in a lesson called the 5 Jars – there’ll be a reference at the bottom of the infographic if you’d like to watch it as well.

Ok, let’s get into: The 5 Jar Method…

Jar 1 – Responsibilities and Managing Other People’s Money:

It’s extremely important that you be responsible with money that doesn’t belong to you.

This includes debts that you owe, such as your credit cards.

The Bible says to owe no man anything but to love him, however most of us do end up with some debt… some more than others.

It should be a priority for us to get those paid off as soon as possible.

When economies crash, it’s those with unpayable debts that lose everything, and those with a little extra cash on the side who come out much better then they were before.

Create a jar or fund dedicated to paying off your debts… a suggested amount for this method is 10% of your income.

Side note: For Jews and Christians, this Jar should be the 10% tithe, Biblically speaking this money doesn’t belong to us, it belongs to God.

Jar 2 – Generosity & Giving, the Anti-Scrooge: 

Giving is an extremely important part of life.

It can have several health and mental benefits, such as feeling good about yourself, being happier, and feeling more detached from materialism.

It can make someone else’s life a little better (perhaps someone who’s much less fortunate then yourself), and selfishly speaking, what you sow you shall reap.

Generosity tends to come back to you.

One of many ways we can be generous is with our finances.

Think about setting aside 5% – 10% of your income as a generosity fund.

Jar 3 – Saving For A Rainy Day:

Saving money is an obvious, but surprisingly a lot of people either fail to do this or don’t believe that they can.

Just try setting aside 10% of your income, save it, don’t spend it.

You might have to make some sacrifices, maybe a little less coffee, or a little less smoking, or a little less of something else that may be slowly sucking up your access cash.

You could give up your cable and do something more productive or educational instead.

At any rate, by saving you’ll be able to make larger purchases in cash later on, or have money set aside in case of an emergency or an unexpected expense.

You can even use this to purchase monthly groceries in cash instead of with credit… you might be surprised how much money that will save you.

Jar 4 – Investing And The Hope Of Return:

We can’t offer investing advise, but learning to invest for long and short term returns is very important.   piggy bank borrow money save parent glasses stern lesson learn

This is a way how you can start a second source of income (aside from getting a second job – which may or may not be a good idea in your situation).

It can then eventually become a third and a fourth if you learn what you can wisely invest in and gain consistent returns.

Some people do micro or personal loans, some learn the stock market or a stock market niche, some go into rental property, or buy and sell, there’s lots of different options here.

Investing does carry an inherent risk factor, but it also carries the hope of a return.

Learn how to invest properly and wisely.

Consider putting no more then 20% of your income into this jar, and never make an emotional investment decision.

Some great advise: find a mentor – find someone who is a successful investor of some sort, and do what they do, ask for advise, learn how they do what they do.

Jar 5 – Spending Time… Finally:

Many people make this their first and only jar… that’s a big mistake.

Take care of your priorities and responsibilities first, then enjoy your spending with more ease of mind.

If you follow the 5 Jar Method, then ideally you’ll have 50% of your income to spend.

And that’s AFTER you’ve taken care of your responsibilities and debts, been generous, set aside money for savings, and even for investing in the hopes of gaining some returns!


Now obviously everyone’s situation is different, and we’re not suggesting you follow this method to the ‘T’.

For your particular situation, you may have to give more or less in a particular jar that’s not as much of a priority, perhaps just for a time.

And of course your financial decisions are in your own hands. But we do hope that this article and the infographic below is of some help and benefit to you or someone you know.
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Also published on Medium.

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Michael is a director of Metropole Property Strategists who create wealth for their clients through independent, unbiased property advice and advocacy. He's been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit

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