How much money should one be able to save each month?

Question

I understand this varies on your income. But I just want to know what is the appropriate and recommended amount should one be able to save each month.

Answer 1

depends how much you make. but i would suggest you save 25% of every paycheck and save that.

Answer 2

A different approach is a "backwards" approach.

Ideally, you should have a minimum of 2 month's salary in your savings, to cover expenses if you ever get laid off/fired/quit.

Once you've established that amount, figure out how long you feel you can take to save that amount... 4 months? 6 months? 8 months?

So then, take the amount and divide it by the number of paydays that covers the period of time, and that is the amount to set aside each payday.

Have a great day.

Answer 3

There are so many variables that depend on you but as a general rule, 15% - 20% of your net pay if you have no retirement vehicles (like 401(k), Roth IRA, ect).  And if you don't, the first $5,000 should be going into a Roth IRA.  If you are already contributing the maximum amount to these, then 10% of your net pay.  That savings should be used for an emergency fund of up to 3-6 months income. That emergency fund money should go into something safe and liquid like a no-risk CD or a money market fund.   After that emergency fund is set, all non-mortgage debt should be paid off.  After the debts are paid, then split the savings between prepaying the mortgage and a mix of solid investments.

Answer 4

10% of your income should be put aside for the long term. (retirement)

A further 10% should be put aside for emergencies and special events.

With todays volitile housing situation re mortgages, set about reducing your mortgage as much as possible.

If you haven't got mortgage repayment insurance, get some.

Answer 5

1/3 of what you bring home. Net not gross.

Answer 6

I wouldn't presume to answer that question for you without knowing your specific circumstances, but let's just take a "minimum" example. Would you think you could save $5/day? After thirty yeas of doing that and compounding the earnings, you'd have about $150,000. Not enough to retire on, but a nice cushion. You can also work the math backwards and start with what you'd like to have accumulated in 30 years.

Answer 7

At least 10% after taxes. Try for 25% after taxes if you can.

Answer 8

I use a 30% rule that is a savings of 30% over any income that you have.

This, at first, will look like a lot, but after you have enough  savings that you can go without any income for a considerable period of time (with today's market, 3 months at least), you can diminish the savings to 10, 15% and transform the remaining  into investments.

Let's say that in a year you made 100,000.00 and in the first 6 months you have saved 30% of what you earned. This will give approximately 15,000.00 of savings. If you run out income this would take care of your expenses for 2 months. On the next 6 months you keep saving the same 30%, but now you will only keep in a savings account 15%, the other 15% you will invest into a CDC. If you keep 7,500.00 into a CDC for 12 months, in a interest rate of 3.75%, you should get back about 282.00 (doesn't seem as much, but remember that you did not work for this money).

Anyway, is up to you.

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Answer 9

That question really has no definite answer.  It all depends, as you have stated, on how much you earn, how much your expenses are etc.  

Keep track of your spending.  At least once a month, use credit card, checking, and other records to review what you've purchased.  Then, ask yourself if it makes sense to reallocate some of this spending to a savings account.