The Six Jar Money Management System That Changed My Life (And Will Change Yours)
Three years ago, I was earning ₹1.2 lakhs per month and still couldn't tell you where my money went. Sound familiar?
Despite a decent salary, I was living paycheck to paycheck, stressed about money, and had zero savings to show for years of hard work. Then I discovered a system that completely transformed my relationship with money.
Today, I'll share the exact six jar system that helped me take control of my finances - and how you can implement it starting this month.
The Problem: Money Without a System
Here's what my finances looked like before the system:
Salary hits account
Pay some bills
Buy whatever I want
Wonder where the money went
Repeat next month
No plan. No tracking. No growth.
The result? Despite earning well, I was broke 20 days into every month.
The Solution: Six Jar Money Management
The six jar system, originally created by T. Harv Eker, divides every rupee you earn into six specific purposes. Think of it as giving every rupee a job before you spend it.
Here are the six jars and their default allocations:
Jar 1: Financial Freedom Account (10%)
Purpose: Your ticket out of the rat race Use: Only for investments that generate passive income
This money NEVER gets spent on expenses. It only goes toward:
Rental properties that generate monthly income
Business investments
Gold, silver, or other appreciating assets
Dividend-paying investments
Real Example: ₹10,000/month × 12 months = ₹1.2 lakhs annually. In 5 years, that's ₹6 lakhs - enough for a down payment on rental property.
Jar 2: Long-Term Savings (10%)
Purpose: Major purchases without debt Use: Big expenses you know are coming
Car purchase (without loan)
House down payment
Wedding expenses
Emergency medical costs
Kids' education
Jar 3: Education Account (10%)
Purpose: Investing in yourself Use: Skills that increase your earning potential
Professional courses and certifications
Books, seminars, workshops
Coaching and mentoring
Business skills development
Why this matters: A ₹50,000 course that increases your salary by ₹20,000/month pays for itself in 3 months.
Jar 4: Necessities (55%)
Purpose: Living expenses Use: Everything you need to survive and maintain your lifestyle
Rent/EMI
Groceries
Utilities
Transportation
Insurance
Basic clothing
Jar 5: Play Account (10%)
Purpose: Guilt-free enjoyment Use: Fun activities that don't create long-term debt
Dining out
Movies and entertainment
Hobbies
Short vacations
Gadgets and toys
Key rule: You MUST spend this money every month. Why? Because restriction without reward leads to financial rebellion.
Jar 6: Give Account (5%)
Purpose: Contributing to others Use: Charity, gifts, helping family
Religious donations
Charity contributions
Gifts for family and friends
Helping those in need
The psychology: Giving creates abundance mindset and attracts more wealth.
How to Implement the Six Jar System
Step 1: Open Six Bank Accounts
Yes, literally six different accounts. This physical separation is crucial for mental clarity.
Pro tip: Use different banks or account types:
Savings accounts for daily use (Necessities, Play)
Fixed deposits for long-term goals (LT Savings)
Investment accounts for wealth building (Financial Freedom)
Step 2: Set Up Automatic Transfers
On salary day, automatically transfer money to each jar:
₹1,00,000 salary example:
Financial Freedom: ₹10,000
LT Savings: ₹10,000
Education: ₹10,000
Necessities: ₹55,000
Play: ₹10,000
Give: ₹5,000
Step 3: Track and Adjust
Use apps like Cashew or simple Excel sheets to monitor each jar monthly.
Monthly review questions:
Did I stick to my allocations?
Which jar needs adjustment?
What did I learn about my spending patterns?
Customizing Your Percentages
The default percentages are starting points. Adjust based on your situation:
High debt?
Necessities: 70%
Financial Freedom: 5%
Others: Reduce proportionally
High earner?
Financial Freedom: 20%
Necessities: 45%
Others: Adjust accordingly
My current allocation:
Necessities: 31%
Financial Freedom/Business: 49%
LT Savings: 9%
Education: 1%
Play: 4%
Give: 6%
Common Mistakes to Avoid
Mistake 1: Borrowing Between Jars
Never take money from Financial Freedom jar for expenses. This defeats the entire purpose.
Mistake 2: Not Spending Play Money
Restriction without reward creates financial stress. Enjoy your play money guilt-free.
Mistake 3: Starting Too Aggressively
Begin with at least 1% in each jar, even if money is tight. Build the habit first, increase amounts later.
Mistake 4: Giving Up After One Bad Month
Perfection isn't the goal. Progress is. One bad month doesn't erase the system's power.
The Results You Can Expect
Month 1-3: Awareness and control
You'll know exactly where your money goes
Spending becomes intentional, not impulsive
Financial stress reduces significantly
Month 4-12: Momentum and growth
Emergency fund builds automatically
Investment opportunities become clear
Money confidence increases
Year 2+: Wealth building acceleration
Passive income streams develop
Financial freedom becomes realistic goal
Money works for you, not against you
Your 30-Day Challenge
Ready to transform your finances? Here's your action plan:
Week 1: Open six bank accounts and set up automatic transfers Week 2: Track every expense and categorize by jar Week 3: Make your first Financial Freedom investment Week 4: Review, adjust, and plan month 2
The Bottom Line
The six jar system isn't just about money management. It's about taking control of your financial future.
Most people let money control them. With this system, you control your money.
The question isn't whether this system works - thousands of people worldwide have proven it does. The question is: Will you implement it?
Ready to master your money? Join my free 3-Day Financial Freedom Bootcamp where I'll walk you through setting up your six jar system step-by-step, plus show you exactly how to make your first investments.
[REGISTER FOR FREE BOOTCAMP →]
Next session starts this weekend. Limited to 100 participants.
