How to Divide Money for Savings Using Multiple Debit Cards

If 60% of Dubai millionaires are self-made, you can also build wealth by improving how you manage your money.

“If wishes were horses, even beggars would ride,” says the popular proverb. One such wish that many people nurture but can seem forever out of reach is to become wealthy. 

However, with the right steps, this does not have to be building a castle in the air. If 60% of Dubai millionaires are self-made, according to the Khaleej Times, then you can build wealth without any inheritance or windfall. 

Building wealth begins with knowing how to divide money for savings since savings are the engine of wealth. 

“It's not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for,” said Robert Kiyosaki, an entrepreneur and real estate investor. 

In what follows, we will consider different ways you can divide your money for savings and how to use your savings to build wealth. We’ll cover: 

  1. How to divide money for savings: 4 budgeting rules
  2. Avoiding overspending: How to protect your savings
  3. How to build wealth with your savings

[Do you want to build wealth and achieve your financial goals? Download the Maly app for free to access tools like multiple debit cards, AI Money Mentor, and MalyGPT, that will help you better manage your money.]

1. How to divide money for savings: 4 budgeting rules

Transforming your financial situation begins with having a monthly budget and sticking to it. 

A budget is a way of telling your money where it should go instead of wondering where it all went, to paraphrase John Maxwell, the leadership expert and motivational speaker. 

Without a budget, you will end up overspending, living from paycheck to paycheck, and becoming indebted. This is why many people evaluate their lives after working for years and wonder where all the money went. 

Budgeting starts with the enumeration of your monthly household income. Here you are summing up all the income that will accrue to your household in a given month. It can include employment income and earnings from other side hustles (or passive income sources). 

(In the UAE where there is no personal income tax (PIT), there is no difference between after-tax income and pre-tax income. For Americans and others who pay PIT, it is the after-tax income that is relevant here.)

The next step is to divide your income between your needs (essential expenses) and wants (non-essential expenses) and then set apart a portion as savings. But the important question is how much percent should you save?

To answer this question and make the budgeting process simpler, personal finance experts have designed or popularised different budgeting methods (rules) that can help. 

We consider the most popular budget plans below: 

The 50/30/20 budget rule

The 50/30/20 rule was popularised by Elizabeth Warren, a US senator, in her book, All Your Worth: The Ultimate Lifetime Money Plan

This rule requires that you spend 50% of your monthly income on needs (food, rent or mortgage, electric bill, clothing, health insurance, life insurance, minimum payments on credit card debt, student loan repayment, etc.) and 30% on wants (eating out, travel, cell phone subscriptions, streaming services, gym membership, etc.). The remaining 20% is your monthly savings.   

The 50/30/20 rule is simple and easy to implement. It helps avoid the complications that can often arise from the budgeting process (take the number of budgeting apps as an example). 

Though this rule remains the most popular, various iterations have been developed to deal with certain situations. 

The 60/20/20 rule

This rule reduces the allocation to wants by 10% and adds it to needs. Such an iteration is useful for people who have to spend more on something like rent or mortgage (or any of the items that constitute needs). 

60 20 20 rule

The 70/20/10

This is another rule for heavy spenders on needs. The portion for needs is now increased to 70% while that of wants has been reduced to 10%.

Source: Blue Copper Capital

The 80/20 money rule

Notice that the difference between the rules above is the allocation of needs and wants; they all answer the how much per cent should you save question in the same way:  20% should be allocated to savings. 

Instead of trying to divide the remaining 80% between needs and wants, the 80/20 rule lumps them together. 

Though this rule does not specify the relative importance of needs and wants, it compensates for that by giving users the freedom to decide on how to weigh their needs and wants (based on their spending habits). Thus, it accommodates both heavy need spenders and heavy want spenders. 

FIRE rules

While personal finance experts generally agree that saving 20% of your income consistently is good enough to get the wealth-building process started, some people believe they can go on a faster lane. 

For example, there is a movement called Financial Independence, Retire Early that prioritizes early retirement and/or financial security/independence. You may be surprised that some people in this movement save up to 70% of their income with many retiring at a young age with massive retirement savings. 

People in this movement tend to be single people with high incomes or those with low to medium incomes who are very deliberate about saving money (through bulk purchases, Do it Yourself programs, cooking at home, among other money-saving tips) or have chosen to live an austere lifestyle.  

So, which of these budgeting rules should you choose? If you are just getting started, saving 20% of your income is enough. You can then choose any of the first 3, depending on how much you spend (or anticipate to spend) on your needs relative to your wants. 

However, if you want the freedom to decide between needs and wants every month, you may choose the 80/20 rule, though this may mean redoing your budget every month (extra stress). 

Anyone you choose is fine. What matters is that you get started and that you stick to your budget. 

It is worth noting that some people are only able to save 10% of their monthly income due to the high cost of living (especially low or medium-income households with children). If 10% is more practical for you, start from there and see if any room opens (consider some smart money-saving tips) to move up to 20%.  

2. Avoiding overspending: How to protect your savings

Sticking to your budget means avoiding overspending. 

One way to do this is to save before you spend. As Warren Buffett puts it, “Don't save what's left after spending, but spend what is left after saving.” 

When you put your 20% savings somewhere else on payday (instead of in your checking account), you can reduce the temptation to spend it. 

Another important solution to overspending is to use Maly’s multiple debit cards.

Instead of keeping all your money in a bank account, you can create cards for each of your major expense categories (for example, food, eating out, clothing, insurance premiums, entertainment, etc.) and load the card with the budgeted amount for the month

Since you cannot overdraw on these cards (like you can on credit cards), you can always keep yourself in check. 

If you budgeted AED 500 for eating out and you have spent AED 300 by the 17th of the month, now you know that you can only spend AED 200 more for the month. 

These multiple cards are also useful if different people are responsible for the expense categories. If the person handling groceries is different from the person who handles utilities, for instance, you can create two cards for them and load them with the budgeted amounts.

By avoiding overspending, you can protect your savings and ensure they are being used for the designated purpose – wealth building. 

  1. How to build wealth with your savings

Before you start investing, you need to have a shock absorber that gives you the proper foundation for wealth building. 

How so?

Building an emergency fund

If you invest all your savings, what would you do if you suddenly need to travel or need to pay some unplanned out-of-pocket healthcare expenses? In the extreme case, consider someone who just lost their job. 

The two options are liquidating your investment and borrowing. With the former, you may lose money as you end up rapid-fire selling your investment at a price lower than you bought them. Also, the latter involves wasting money paying high interest rates for consumer debt. 

An emergency fund is a better solution. It allows you to use some of the money you have saved in previous months to settle any emergency that might arise. 


Source: Faster Capital

Experts often advise that your emergency fund should be large enough to cover six months’ worth of your needs and months (both are also called living expenses). So, if your needs and wants in a month add up to AED 5,000, you need AED 30,000 in that fund. 

Since you might end up liquidating your investments to meet emergencies, it is better to first build this fund before starting your investment journey, in the same way you don’t move a car without its shock absorber.

Saving for short-term goals

For short-term savings goals (saving to buy a car, make a down payment on a mortgage, go on a holiday, pay a child’s school fees, etc.), you need to keep your money where you are sure they won’t lose value

Here, the focus is on capital preservation rather than strict wealth building. Therefore, you should be content with earning low returns on assets or financial instruments (savings accounts, certificates of deposits, treasury bills, etc.) where you are 100% sure your money won’t lose value by the time you need it. 

Investing for long-term goals

This is where you build wealth. The focus here is on long-term investing so you must choose assets and financial instruments that can provide high returns over the long term. 

Some of the tested and trusted assets you can use to build wealth include stocks, bonds, ETFs, mutual funds, and real estate investment trusts (REITs), among others. 

Create a portfolio of these assets (can be your IRA – individual retirement account) and systematically invest in that portfolio every month. With compound interest and the power of consistency, you would be surprised at how much wealth you can build in just 10 years. 

If you invest AED 3,000 at the end of every month at conservative yearly returns (with quarterly compounding) of 8%, you will have $518,100 at the end of year 10. 

Improving money management with Maly

If you are in the UAE and you want to improve your money management, Maly is the partner you need. 

As we have seen, the multiple debit cards Maly provides can help you monitor your spending and avoid overspending (which is crucial to protecting your savings). 

That is not all, however. 

Maly’s AI Money Mentor can be your finance coach, providing you with a personalized wealth or financial plan (based on your risk tolerance and time horizon) that will help you achieve your financial goals. If you can’t afford financial advisors, AI Money Mentor can serve that function to your satisfaction. 

This AI assistant can also help you create a budget and design a debt repayment strategy. The more accurate information you provide for it, the better suggestions and guidelines it can provide for you. 

If you need to improve your financial knowledge, MalyGPT is exactly what you need. A financial counterpart of ChatGPT, MalyGPT will answer your money and personal finance questions, providing you with information that will make you financially savvy.  

[Are you ready to gain better control of your finances so you can build wealth and achieve your financial goals? Download the Maly app for free today and get access to tools that will improve your money management.]


  • Knowing how to budget and save money is the foundation of financial well-being and wealth building.
  • Budgeting rules simplify the budgeting process, making it easy for you to know how to divide money for savings. 
  • By saving before spending and using multiple debit cards, you can avoid overspending and protect your savings. 
  • You should your savings to build an emergency fund (for unexpected expenses), achieve short-term goals, and build wealth for the long term (including retirement planning). 
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