Jars Saving Method


Ever heard of the Jars Saving Method?

The concept of JARS or the jars saving method is to help you allocate your source of income into different savings jars/accounts. Who knows when you would be needing immediate access to these funds? The point being proven in this savings method is to make sure you have enough funds for use on specific events that could occur at different points in your life.



Jar # 1: “Black Hole”

A black hole is defined to be a region of space time from which gravity prevents anything, including light, from escaping. Therefore, the Black Hole Jar is supposed to behave this way as well. This is the jar that you lock up. This is the jar in which you don’t intent to use its content. The funds that goes inside the black hole do not come out of it unless it’s for emergency purposes.

Jar #2: Future Funds

Been meaning to save up for important events such as your dream wedding, anniversary, a birthday celebration, building your dream house or owning your own car? Jar # 2 is all about saving up for your important future events.

Jar # 3: Emergency Funds

Death. Accidents. Tragedy. Injuries. Misfortunes. Hospitalization. There are things in life that no one can ever really prepare for. Jar # 3 is solely made for the unexpected. Funds in Jar # 3 should be used for the following: paying for medical insurance and Critical Illness Benefits, life insurance premiums, business insurance for disasters like flooding, fire and earthquake damages. Jar # 3 must also be liquid. There must be extra cash to sustain excess expenses in disaster and tragedy cases.

Jar # 4: Personal Savings and Daily Needs & Expenses

Personal Savings = Bank Account Savings
Don’t spend everything you earn. Always learn to save up and keep a sufficient enough amount to help you cope with expenses. The funds at Jar # 4 is used for daily expenses such as gas and transportation allocation, eating 3 meals per day, and occasional recreational spending such as watching a movie and going out for dinner.


TIP: Don’t max out on Jar # 4. You can still use Jar # 5’s funds for months when you find yourself going over budget.

Jar # 5: Investment

Jar # 5 is the “making money work for you” jar. While Jar’s 1-4 is all about savings and expenses. Jar # 6 can generate money for you from your existing funds.

It’s All About Budgeting

We oftentimes go overboard with excessive spending on impulsive wants. Most often or not, we find ourselves spending more for our wants than our basic needs. It shouldn’t be that way all the time. JARS savings method is a practical system for you to track down and efficiently use your hard earned money. (Related: Financial Tips)


Diversification Advantage

It isn’t advisable to keep all of your money in one place. Have all your money been sleeping in a bank savings account or time deposit account? It doesn’t earn much given the low interest rates we are currently experiencing. Still keeping your money under your pillow? Ever heard of theft and burglary? It’s time to diversify your funds and place them in various moneymaking instruments.

Fund Allocation for JARS Savings Method

You can create your fund allocation for Jars Savings Method depending on your needs, immediate and long-term goals and priorities.

Examples of different fund allocations:



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Money Monkeys

Money Monkeys seeks to educate on topics related to finance, entrepreneurship, and the rising fintech innovations. We provide easy to digest articles with the aim of raising financial literacy, cultivating a growth mindset, and harnessing the spirits of fellow entrepreneurs.

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