Earnings = Income - Expences .

Wait a minute i, I always believed that what i spent was from what i earned right ? wrong !!!

When you spent it it is no longer your earned money, its spent money, an expense.. now economics wise this is wrong i know but just take my word that to achieve financial happiness you need to have the ability to not spend.. This works in two ways, it will help you to save when you do earn and also help you when earnings are down by ensuring that your cash goes a long way. 

Every body knows that you cannot spend money that you don't have , well in today's credit hungry world this is easy to forget. the credit card seems like a good friend till you spend and cannot pay all of it back. the Credit Card will just becomes a cash guzzling monster. 

Any debt that is incurred to feed an expense is generally a monster that will soon swallow any reserves that you may have. Note the word expense.

So debt is a four letter word to avoid ? No !! 

A debt taken to create an asset and partly funded by the assets ability to generate cash / income is a good debt. provided the circumstances that enable it to fulfill its promise remain the same. A good example would be buying a car that can rented out. Note that the EMI on the vehicle may be more than the revenue that is generated but once the debt is paid off , you now have the extra cash while the car is still able to generate the cash. This is your earning.. 

So the lesson here is, do not spend all your income just because you can. if you do that then the earned amount is Zero.. an earning is surplus over all expenses that gives you the opportunity to create capital. and capital when invested wisely gives you earnings..

Yeah Savings would be the right word.. but earnings means you worked for it..