Earn, Spend, Save vs Earn, Save, Spend

In most cases, people are uses to the following formula: (Formula I)

(Earnings) - (Spendings) = [(Savings) + (Investments)]

In wiwts' point of view, the following formula would be better: (Formula II)

(Earnings) - [(Savings) + (Investments)] = (Spendings)

Isn't it?
Earnings can be any source of income: salary, interest, dividend, rental collection, etc.
Savings indicated an amount of money that put aside without touching it.
Investments can be like anything ranging from Mutual Fund, Equity, Derivative, Real Estate, etc.
Spendings means an amount of money to be turn into materials, that cannot generate any source of income.

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From wiwt's observation, most of the people are facing financial problems, where "too many things to buy but little cash in hand". The main reason is , they tend to follow the 1st formula, instead of the 2nd.

The ideal calculation for Formula II
(Age 21-30)
Savings should be 15% of Earnings
Investments should be 25% of Earnings

(Age 31-40)
Savings should be 20% of Earnings
Investments should be 20% of Earnings

(Age 41-50)
Savings should be 30% of Earnings
Investments should be 10% of Earnings

(Age 51-60)
Savings should be 35% of Earnings
Investments should be 5% of Earnings

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In order to achieve Formula II, a person should be debt free. For a person in debt, he/she should reduce 5% from each Savings and Investments and put 10% for DEBT.