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How much should you save each month?

1 minute read

Saving money is hard, especially if you are living from one month to the next. This is why learning how to save is so important. 

By being smart with your money, you might be able to plan ahead and avoid struggling to pay your bills each month. 

In this article you will find different saving tips and you will also be able to figure out how much money you should be saving each month from your income.

How much should you save?

This amount will vary depending on different factors. According to the most popular budgeting rule, 20% of your monthly income should go to your savings account.

Having a savings account will help you achieve your financial goals and it might also save you from an emergency. Even though the amount is set at 20%, it does not necessarily mean that you have to stick to it. The amount you save can vary depending on your different goals and retirement expectations.

Tips for better saving habits   

Now that you know how much you should be saving every month, how can you go about actually doing it? 

  • Budgeting

You have learned that you should be saving somewhere around 20% of your income, but there are other budgeting methods out there for you to choose from. For example, the 50/30/20 rule, the 50/15/5 rule, the 80/20 rule, the 70% budget rule, etc. Which budgeting method should you choose? Try them out and see which one suits your lifestyle best. 

Some of the most important tools are budgeting apps that help you track your progress. Set your goals and start saving the amount you want or need.

Then, every month track your progress to see how you are doing. Using a mobile app can help you visualize your progress in a more friendly way.

  • Automate your process

Look for options like a 401(k). This will automatically take a percentage of your income and put it into your retirement account. 

These types of options will make saving easier if you struggle setting apart some money for your savings.

  • Set goals

This might seem obvious, but setting a tangible goal that will take some time to achieve (a big trip or a wedding) can be the perfect motivation to start saving.

The discipline of saving is not easy to acquire, but once you have a goal in mind and a timeline to achieve it, you will find it easier to save a determined amount of money.

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Arturo Mendez

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