Why five pockets?
I created this system because I wanted a simple way to decide where my money should go before I spent it.
Instead of tracking dozens of categories, I divide each paycheque into five bigger priorities.
Giving
This is money set aside to give first.
For me, that means giving to God through tithing. For someone else, it might include their church, charities, causes they care about, or other ways they choose to give.
You
It is easy for every dollar to disappear into bills and responsibilities.
This pocket gives you permission to enjoy some of the money you earn. It might include clothes, hobbies, personal care, eating out, or something you have been wanting.
Others
This is money set aside for generosity toward other people.
It might pay for a gift, someone's dinner, helping a friend or family member, or responding when an opportunity to help comes up. Having the money already set aside can make generosity easier.
Future
This pocket is for expenses and goals that are not happening today.
It might include emergency savings, debt repayment, vacations, Christmas, home repairs, a future vehicle, retirement, or other financial goals.
Future expenses eventually become current expenses, so this pocket helps you prepare before they arrive.
Family
This is the largest default pocket because it covers everyday household life.
It might include housing, groceries, utilities, fuel, insurance, transportation, children, and other regular expenses.
Make it yours
The default percentages are a starting point, not a rule. Your income, family, debt, priorities, and goals may look completely different.
When choosing your percentages, consider:
What needs to be covered right now?
Make sure your everyday expenses are realistic.
What do I want to prepare for?
Give future expenses and goals their own place.
What matters most to me?
Your pockets should reflect your priorities.
Can I realistically stick with this?
A simple plan you can follow is more useful than a perfect plan you abandon.
You can change your percentages as life changes.
When money comes in, you already know where it belongs.
Back to my pockets