Executive Summary

“Profit First” by Mike Michalowicz introduces a revolutionary approach to business financial management that flips the traditional accounting formula. Instead of the common “Sales – Expenses = Profit,” the “Profit First” formula is “Sales – Profit = Expenses.” This system leverages human behavioral tendencies, rather than fighting them, to ensure businesses are profitable from the moment of their next deposit. It emphasizes a “small plate” approach to managing money, creating separate bank accounts for different purposes (Profit, Owner’s Pay, Taxes, Operating Expenses) and allocating funds in predetermined percentages, with profit being taken first. The book argues that many businesses, even seemingly successful ones, operate in a “check-to-check” and “panic-to-panic” cycle due to a sole focus on revenue growth and the inherent flaw of GAAP (Generally Accepted Accounting Principles) when it comes to human behavior. “Profit First” aims to empower entrepreneurs to achieve permanent financial health, reduce debt, and live a life where their business serves them, not the other way around.

II. Main Themes and Core Principles

A. The Flawed Traditional Accounting Formula and its Impact

• Traditional Formula: The prevalent business financial management approach, “Sales – Expenses = Profit,” leads entrepreneurs to treat profit as an afterthought or “leftovers.”
• “Simply put, the Profit First system flips the accounting formula. To date, entrepreneurs, CEOS, freelancers, everyone in nearly every type of business has been using the ‘sell, pay expenses, and see what’s left over’ method of profit creation.”
• This often results in businesses barely surviving, accumulating debt, and never reaching true profitability, regardless of their revenue size.
• “Most entrepreneurs are just covering their monthly nut (or worse) and accumulating massive debt. We think bigger is better, but so often all we get with a bigger business are bigger problems.”
• GAAP’s Misalignment with Human Behavior: While logically sound, GAAP (Generally Accepted Accounting Principles) goes against human nature by encouraging a focus on sales and expenses first.
• “Logically, GAAP makes complete sense… But humans aren’t logical… Just because GAAP makes logical sense doesn’t mean it makes ‘human sense.’ GAAP both supersedes our natural behavior and makes us believe bigger is better.”
• This leads to spending whatever is available and justifying all expenses, often in pursuit of growth without concern for health.
• “No matter how much income we generate, we will always find a way to spend it—all of it. And we have good reasons for all of our spending choices. Everything is justified. Everything is necessary.”

B. The “Profit First” Formula and its Behavioral Foundation

• The New Formula: “Sales – Profit = Expenses.” This simple reordering fundamentally changes behavior.
• “The math in both formulas is the same. Logically, nothing has changed. But Profit First speaks to human behavior—it accounts for the regular Joes of the world, like me, who have a tendency to spend all of whatever is available to us.”
• Leveraging Human Nature: The system works with natural tendencies, not against them, by creating the experience of having less cash available for expenses than actually exists.
• “The solution is not to try to change our ingrained habits, which is really hard to pull off and nearly impossible to sustain; but instead to change the structure around us and leverage those habits.”
• The “Small Plate” Metaphor: Inspired by diet psychology, the core idea is to allocate money into separate, smaller “plates” (bank accounts) for specific purposes, preventing overspending.
• “When we use smaller plates, we dish out smaller portions, thus eating fewer calories while continuing our natural human behavior of serving a full plate and eating all of what is served.”

C. The Four Core Principles of Profit First

1. Use Small Plates (Account Allocation): Immediately disperse incoming revenue into different bank accounts with predetermined percentages for:

• Profit Account: For owner’s profit distributions and cash reserves.
• Owner’s Pay Account: For consistent, realistic owner salaries.
• Tax Account: To reserve money for tax obligations.
• Operating Expenses Account: For all other business expenses.
• “When money comes into your main operating account, immediately disperse it into different accounts in predetermined percentages.”

1. Serve Sequentially (Prioritize Profit): Always move money to the Profit Account first, then Owner’s Pay, then Tax, and then whatever remains to Operating Expenses.

• “Always, always move money to your Profit Account first, then to your Owner Pay Account and then to your Tax Account, with what remains to expenses. Always in that order. No exceptions.”

1. Remove Temptation (Separate Bank Accounts): Keep Profit and Tax Accounts at a separate bank, making it difficult and inconvenient to “borrow” from them.

• “Move your Profit Account and other accounts out of arm’s reach. Make it really hard and painful to get to that money, thereby removing the temptation to ‘borrow’ (i.e., steal) from yourself.”

1. Enforce a Rhythm (Bi-weekly Allocations): Implement a consistent schedule (e.g., 10th and 25th of each month) for allocating funds and paying bills. This creates control and clarity over cash flow.

• “Do your payables twice a month (specifically, on the 10th and 25th). Don’t pay only when money is piled up in the account. Get into a rhythm of paying bills twice a month so you can see how cash accumulates and where the money really goes.”

D. The “Survival Trap” and the Illusion of Growth

• Crisis-Driven Decisions: The traditional revenue-focused approach often leads entrepreneurs to make short-term decisions that pull them away from their long-term vision.
• “The Survival Trap is not about driving toward our vision. It is all about taking action, any action, to get out of crisis.”
• “Bigger is Not Always Better”: Constant growth without financial health only creates “a bigger monster” with “bigger problems.”
• “Most business owners try to grow their way out of their problems, hinging salvation on the next big sale or customer or investor, but the result is simply a bigger monster.”
• All Revenue is Not Equal: Some revenue is highly profitable, while other revenue sources (e.g., bad clients, unprofitable offerings) can actively generate debt and pull a business down.
• “Never forget: All revenue is not the same. Some revenue costs you significantly more in time and money; some costs you less.”

E. Importance of Efficiency and Focused Operations

• Efficiency Drives Profit: True profitability comes from increasing efficiency, meaning achieving more results with less effort and cost.
• “If you want to increase profitability (and you’d better friggin’ want to do that), you must first build efficiencies.”
• This includes focusing on serving “great” clients with consistent needs using refined solutions, like McDonald’s focusing on a few core products.
• “The fewest things you can do repetitively to serve a consistent core customer need—this spells efficiency.”
• Firing Bad Clients: Unprofitable clients drain resources and dilute the profits generated by good clients. Eliminating them frees up time and money to clone ideal clients.
• “The top quartile generated 150% of a company’s profit… the bottom quartile, the one that generated 1% of the total revenue, resulted in a profit loss of 50%!”
• “Just One More Day” Game: A tactic to delay unnecessary spending, encouraging frugal behavior and fostering alternatives.
• “He challenges himself to go just one more day without the item. Every time he passes up an opportunity to buy whatever he needs, he gets pumped. He gets a high from going without for one more day.”

F. Debt Destruction and Lifestyle Management

• Debt Freeze and Snowball: Stop accumulating new debt immediately and systematically pay off existing debt, starting with the smallest, to build emotional momentum (following Dave Ramsey’s “Debt Snowball” principle).
• “You need to get your Debt Freeze on. And then destroy debt, once and for all.”
• “It is getting to tear up a statement—any statement, because it is fully paid off—that gives you a sense of momentum and gets you charged up to tackle the next one.”
• Quarterly Profit Distributions: Regularly celebrating profit (e.g., taking 50% of the Profit Account balance as a personal distribution quarterly) reinforces the positive habit and shows the business is serving the owner.
• “Your business is serving you, now. You are going to take a distribution check every quarter. Every ninety days, profit will be shared to you.”
• “Lock In Your Lifestyle”: Resist the urge to increase personal spending as income grows. Create a significant gap between earnings and expenditures to build wealth and achieve financial freedom.
• “You will not expand your lifestyle in response. You need to accumulate cash—lots of it—and that means no new cars, no brand-new furniture or crazy vacations. For the next five years, you will lock it in and live the lifestyle you are designing now so that all of your extra profit goes toward giving you that ultimate reward: financial freedom.”
• Personal Application: The Profit First principles extend to personal finance, promoting financial freedom and teaching children sound money management.

G. The Role of Accountability and Continuous Improvement

• Accountability Groups: Joining or forming “Profit Pods” or “Profit Accelerator Groups” is crucial for maintaining discipline and consistent implementation of the system.
• “The worst enemy of Profit First is you… This is why it is imperative that we join (or start) an accountability group… immediately.”
• These groups provide support, shared learning, and external pressure to stick to the plan.
• “The action of enforcing a plan or system with someone else ensures that you are more likely to do your part. You are accountable to the group, and therefore integral to the group, which means you are less likely to drop the ball.”
• Continuous Tweaking: The system is not static; entrepreneurs should constantly look for ways to improve efficiency, adjust allocation percentages (TAPs – Target Allocation Percentages), and refine their processes.
• The Power of Small Actions: Big transformations are the result of consistently applied small, repetitive actions.
• “Small wins lead to big wins.”
• “Momentum builds slowly but relentlessly. Small, repetitive, continuous actions, chained together, build momentous momentum.”

III. Key Facts and Ideas

• New Formula: Sales – Profit = Expenses.
• Core Accounts: Profit, Owner’s Pay, Tax, Operating Expenses.
• Allocation Rhythm: Twice a month (10th and 25th).
• No-Temptation Accounts: Profit and Tax accounts should be at a separate bank.
• Instant Assessment: A quick method to gauge financial health and identify “bleeds” (areas of overspending). Uses Target Allocation Percentages (TAPs) based on Real Revenue.
• “The Real Revenue number is a simple, fast way to put all companies on equal footing.” (Real Revenue = Total Revenue – Materials & Subcontractor costs).
• Expense Cuts: Aim to reduce operating expenses by at least 10% initially to cover initial profit allocations and build reserves.
• Debt Freeze: Immediately stop incurring new debt and implement a Debt Snowball to pay off existing debt.
• When paying down debt, 99% of quarterly profit distribution goes to debt, 1% to personal reward.
• Efficiency Goal: Double results with half the effort.
• Client Management: Focus on cloning “best clients” (those who pay on time, trust you, and buy profitable offerings) and firing “bad clients” (who drain resources and generate losses).
• Owner’s Pay: Should reflect what it would cost to hire a replacement for the work the owner actually does, not just a CEO title.
• “My business serves me; I do not serve my business. Paying yourself next to nothing for hard work is servitude.”
• Tax Account Naming: Change the Tax Account name to “The Government’s Money” to mentally deter “borrowing.”
• The Vault: A low-risk, interest-bearing account for short-term emergencies and eventually a source of income, with clear rules for withdrawal.
• Drip Account: For managing large, upfront payments for services rendered over time, ensuring consistent monthly income recognition.
• Employee Formula: Real Revenue should be $150,000 to $250,000 per full-time employee. For tech businesses, Real Revenue should be 2.5x total labor cost; for “cheap labor” fields, 4x total labor cost.
• Financial Freedom: Achieved when accumulated money yields enough interest/returns to support one’s lifestyle.
• Loss Aversion & Endowment Effect: Psychological principles explaining why people cling to things they possess and resist letting go, even when financially detrimental. The system encourages ripping off the “Band-Aid” quickly.
• Accountability: Join or form Profit Accelerator Groups (PAGs) or Profit Pods to ensure consistent application of the system.
• “The fastest way to screw up Profit First is to start sliding back into old belief systems that got you into trouble in the first place.”
• Bring printed Profit Account statements to meetings to ensure honesty.

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Profit First: A Comprehensive Study Guide

This study guide is designed to help you review and solidify your understanding of the “Profit First” system as presented in Mike Michalowicz’s book.

Quiz: Short Answer Questions

Answer each question in 2-3 sentences.

1. What is the core difference between the traditional accounting formula and the Profit First formula? The traditional formula is Sales – Expenses = Profit, making profit an afterthought. The Profit First formula, Sales – Profit = Expenses, prioritizes profit by allocating it first, forcing businesses to operate on the remaining funds.
2. Explain the “Recency Effect” and how it applies to an entrepreneur’s financial decisions. The Recency Effect is a psychological phenomenon where individuals place disproportionate significance on their most recent experiences. For entrepreneurs, this means making financial decisions based on their current bank balance, leading to cycles of overspending during good times and panic during lean times.
3. How does the author relate the concept of “small plates” in dieting to the Profit First system? The “small plates” concept suggests that using smaller plates leads to smaller portions and, consequently, less consumption, without requiring a change in the habit of cleaning one’s plate. In Profit First, this translates to immediately dispersing revenue into various smaller accounts, forcing the business to operate on a reduced “plate” of funds for expenses.
4. What is the “Survival Trap” and why is “just selling” a dangerous part of it? The Survival Trap is a cycle where businesses focus solely on generating revenue to escape immediate crises, often taking on any sale regardless of its long-term fit or profitability. “Just selling” is dangerous because it can lead to increased expenses, inefficient operations, and taking on bad clients, moving the business further from its vision rather than towards it.
5. Describe the author’s “piggy bank moment” and its significance in his development of the Profit First system. The author’s “piggy bank moment” occurred when his young daughter offered her savings to help him after he lost his fortune. This humbling experience taught him the importance of saving money and securing it from oneself, highlighting that cash is king and true financial security comes from disciplined saving, not just making money.
6. What are Target Allocation Percentages (TAPs) and why are they important in Profit First? TAPs are the predetermined percentages of income that are allocated to different accounts (Profit, Owner’s Pay, Tax, Operating Expenses) in the Profit First system. They are important because they provide a structured goal for how money should be distributed, helping businesses move towards financial health and efficiency over time.
7. Explain the “10/25 Rhythm” in Profit First and its benefits. The 10/25 Rhythm involves paying bills and allocating funds twice a month, specifically on the 10th and 25th. This rhythm helps entrepreneurs gain control over their cash flow, identify spending patterns, and manage bills on time, reducing reactive financial decisions and fostering a more controlled, predictable financial flow.
8. How does the Debt Freeze strategy combine with the Debt Snowball method to address business debt? The Debt Freeze involves aggressively cutting unnecessary expenses to operate at a leaner level, preventing new debt accumulation. This is combined with the Debt Snowball, which prioritizes paying off the smallest debt first to build emotional momentum, then using the freed-up funds to tackle the next smallest debt, systematically eradicating all debt.
9. What is the “Just One More Day” game and what psychological principle does it leverage? The “Just One More Day” game is a technique where an individual challenges themselves to delay a purchase for one more day, finding joy in saving money. It leverages the psychological principle of deriving pleasure from saving rather than spending, helping to foster frugality and uncover alternatives to unnecessary expenses.
10. According to the author, why is joining an accountability group (like a PAG or Profit Pod) crucial for sticking with Profit First? Accountability groups are crucial because human willpower can falter, and internal justifications for straying from the system are common. These groups provide external support, shared commitment, and a rhythm for consistent action, making it easier to maintain discipline, share best practices, and overcome challenges in implementing Profit First.

Answer Key

1. Core Difference: The traditional formula (Sales – Expenses = Profit) treats profit as what’s left over, often leading to an empty plate. The Profit First formula (Sales – Profit = Expenses) flips this, ensuring profit is taken first, forcing the business to operate efficiently on the remaining funds.
2. Recency Effect: The Recency Effect causes people to make decisions based on their most recent experiences, like a high bank balance. For entrepreneurs, this can lead to overspending when funds are plentiful, only to panic and scramble for sales when the balance drops, perpetuating a check-to-check cycle.
3. “Small Plates” Analogy: In dieting, small plates encourage smaller portions without changing the habit of cleaning the plate. In Profit First, this translates to immediately allocating portions of incoming revenue to different accounts, creating a “smaller plate” for operating expenses and forcing more efficient spending.
4. Survival Trap: The Survival Trap is a cycle where businesses prioritize “just selling” to escape immediate crises. This is dangerous because it often leads to taking on unprofitable clients, expanding services unsustainably, and incurring unchecked expenses, ultimately moving the business further from true profitability.
5. “Piggy Bank Moment”: The author’s “piggy bank moment” was when his daughter offered her savings to him after he lost his fortune. This experience was a humbling wake-up call, emphasizing that true financial security comes from saving and protecting money, leading him to develop a system that prioritized profit and disciplined allocation.
6. Target Allocation Percentages (TAPs): TAPs are the target percentages of Real Revenue allocated to different accounts (Profit, Owner’s Pay, Tax, Operating Expenses) in the Profit First system. They are essential as they provide a clear roadmap and measurable goals for how a business should distribute its income to achieve and maintain financial health.
7. 10/25 Rhythm: The 10/25 Rhythm is the practice of allocating funds and paying bills twice a month, on the 10th and 25th. This routine fosters consistent cash flow management, reduces financial anxiety by providing regular check-ins, and helps identify spending patterns and unnecessary expenses.
8. Debt Freeze & Debt Snowball: The Debt Freeze involves aggressively cutting all non-essential expenses and stopping new debt accumulation. The Debt Snowball, then, focuses on paying off the smallest debt first to build emotional momentum, subsequently rolling those payments into the next smallest debt until all are eliminated.
9. “Just One More Day” Game: This game involves intentionally delaying a purchase for “just one more day” to cultivate a sense of pleasure from saving. It leverages the emotional satisfaction of frugality, often revealing that the item wasn’t truly necessary or leading to the discovery of cheaper alternatives.
10. Accountability Groups: Accountability groups are crucial for Profit First because human nature often leads to self-sabotage and backsliding on financial discipline. A group provides external motivation, shared commitment, and a platform for discussing challenges and celebrating wins, helping individuals consistently adhere to the system.

Essay Format Questions

1. Analyze the psychological underpinnings of the Profit First system, specifically discussing how it leverages human behavioral traits like the Recency Effect, Loss Aversion, and the desire for instant gratification, rather than relying solely on logical accounting principles.
2. Compare and contrast the author’s personal journey from being a “King Midas” with a focus on revenue to a proponent of “Profit First.” What key lessons did he learn, and how did these experiences shape the core principles and practical advice offered in the book?
3. Discuss the concept of “efficiency” as presented in “Profit First,” including its relationship to profitability and the author’s challenge to “get two times the results with half the effort.” Provide examples from the text to illustrate how businesses can achieve this, both by eliminating “bad clients” and “cloning good ones,” and by making operational changes.
4. Evaluate the role of debt in the entrepreneurial journey according to “Profit First.” Explain how the “Debt Freeze” and “Debt Snowball” strategies, combined with the continuous application of Profit First, offer a permanent solution to debt rather than a temporary fix.
5. Beyond business, how does the “Profit First Lifestyle” extend the system’s principles to personal finance and family life? Discuss the strategies for personal financial freedom, including managing income, savings, and teaching financial literacy to children, and consider the underlying philosophy that connects business and personal financial health.

Glossary of Key Terms

• 10/25 Rhythm: A key operating rhythm in Profit First where a business allocates funds and pays bills twice a month, on the 10th and 25th.
• Accountability Group (PAG/Profit Pod): A group of entrepreneurs who meet regularly to provide mutual support, share best practices, and hold each other accountable to the Profit First system.
• Analysis Paralysis: The state of over-analyzing a situation or problem so that a decision or action is never taken, crippling progress.
• Angel of Death: A term used by the author to describe his failed investments, where he unknowingly caused the downfall of the businesses he invested in due to his arrogance and poor financial management.
• Assets: In the context of “Profit First,” things that bring more efficiency to a business by allowing for more results at a lower cost per result.
• Bank Balance Accounting: The common, yet flawed, practice of making financial decisions based solely on the current balance visible in a bank account.
• Cash Cow: A term for a business that consistently generates a steady and reliable profit, often used to describe the ideal outcome of applying Profit First.
• Cash Flow Statements: One of the three key financial reports in GAAP, providing a detailed breakdown of how cash is generated and used over a period.
• Debt Freeze: A strategy in Profit First to immediately stop accumulating new debt by drastically cutting expenses and making a commitment to only pay for purchases with cash.
• Debt Snowball: A debt reduction strategy where debts are paid off in order from smallest to largest, regardless of interest rate, to build psychological momentum.
• Drip Account: An advanced Profit First account used to manage retainers, advance payments, or pre-payments for work that will be completed over a long period, releasing funds into the main income account incrementally.
• Endowment Effect: A behavioral theory stating that individuals place a higher value on something they already possess compared to an identical item they do not own.
• Employee Formula: A guideline in Profit First suggesting that for each full-time employee, a company should generate $150,000 to $250,000 in Real Revenue.
• Frankenstein Formula (Sales – Expenses = Profit): The traditional accounting formula criticized in Profit First for making profit an afterthought and leading to inefficient spending.
• GAAP (Generally Accepted Accounting Principles): The standard framework of guidelines for financial accounting, criticized in Profit First for being complex and working against human nature by focusing on sales first.
• Gross Profit (Gross Income): Total Revenue minus the cost of materials and subcontractors directly used to create and deliver a product or service.
• Hedgehog Leatherworks: The author’s one surviving investment from his earlier business ventures, which successfully implemented Profit First.
• Income Account: An advanced Profit First account where all incoming deposits are collected, providing a clear picture of total revenue before allocation.
• Income Statement: One of the three key financial reports in GAAP, summarizing a company’s revenues, expenses, and profits over a period.
• Instant Assessment: A quick method provided in “Profit First” to gauge the real financial health of a business and identify areas of financial “bleed.”
• Just One More Day Game: A psychological tactic to cultivate frugality by challenging oneself to delay a purchase for an additional day, finding joy in the saving.
• King Kong: A metaphor used to describe the overwhelming, hidden financial problems that many businesses face, larger than a mere “elephant in the room.”
• Labor Costs: The expenses associated with employing staff, including salaries, commissions, and bonuses.
• Loss Aversion: A psychological tendency where the pain of losing something is felt more strongly than the pleasure of gaining an equivalent item.
• Material & Subs: Costs associated with materials for manufacturing/retail or subcontractors for service delivery, subtracted from Top Line Revenue to calculate Real Revenue.
• Materials Account: An advanced Profit First account specifically for funds allocated to the purchase of materials, distinct from general operating expenses.
• Monthly Nut: A term for the total amount a business needs to cover its expenses each month, criticized in Profit First for focusing on expenses over profit.
• Operating Expenses Account: The primary account in Profit First used for managing day-to-day business expenses after profit, owner’s pay, and tax allocations.
• Owner’s Pay Account: A dedicated account in Profit First for the regular salary or distributions paid to the business owner(s) for their work.
• Parkinson’s Law: A principle stating that work expands to fill the time available for its completion, or, in a financial context, expenses rise to meet available income.
• Pass-Through Account: An advanced Profit First account for income received from customers that is not considered true revenue for profit allocation, such as reimbursements for travel costs.
• Pareto Principle (80/20 Rule): An observation that roughly 80% of effects come from 20% of causes, applied in Profit First to clients and product profitability.
• Petty Cash Account: A small bank account, often with a debit card, for minor day-to-day purchases like client lunches or office supplies.
• PFP (Profit First Professional): A financial professional (accountant, bookkeeper, coach) trained and certified in the Profit First system, who helps clients implement it.
• Profit First Formula (Sales – Profit = Expenses): The core accounting formula in the system, prioritizing profit allocation before expenses.
• Profit Account: A dedicated account in Profit First for the allocated profit of the business, often held in a separate bank to remove temptation.
• Profit Leader: An entrepreneur who starts and leads a voluntary Profit Pod, helping others with accountability and implementation of Profit First.
• Profit First Lifestyle: The application of the Profit First principles to personal finances, aiming for financial freedom and a disciplined approach to spending and saving.
• Plowback/Re-invest: Terms used to justify taking money from profit accounts to cover operating expenses, which Profit First identifies as “borrowing” or “stealing” from oneself.
• Real Revenue: Total Revenue minus the cost of materials and subcontractors, representing the true income the company generates from its core services or products.
• Recency Effect: See above in Quiz.
• Recurring Payments Account (Personal): A personal finance account for fixed, varying, and short-term recurring household bills.
• Required Income For Allocation (RIFA): A Profit First metric that calculates the minimum business income needed to cover desired owner’s pay, taxes, and operating expenses after allocations.
• Sales Tax Account: A dedicated account in Profit First for collecting and holding sales tax, emphasizing that this money is not income but funds collected for the government.
• Secretly Spoiled: Laurie Udy’s company, an example of a business successfully implementing Profit First.
• Serving Sequentially: A Profit First principle from dieting, meaning to allocate money to accounts in a specific order (Profit first, then Owner’s Pay, then Tax, then Expenses).
• Small Plates: See above in Quiz.
• Stocking Account: An advanced Profit First account used to save for large, infrequent purchases or to stock inventory parts over time.
• Survival Trap: See above in Quiz.
• Tax Account: A dedicated account in Profit First for setting aside money to cover tax responsibilities, often held in a separate bank.
• The Government’s Money: A renaming tactic for the Tax Account to psychologically deter “borrowing” from it, emphasizing it’s not the business’s funds.
• The Vault (Business & Personal): An ultra-low-risk, interest-bearing account for short-term emergencies and long-term savings, with strict rules for its use to prevent cash crises.
• Top Line Thinking: A revenue-focused approach to business management, prioritizing sales growth above all else, often leading to profitability issues.
• Wedge Theory: A personal finance strategy to gradually upgrade one’s lifestyle as income increases, setting aside half of every income bump into savings to build wealth.