Posted: 3/28/2014 4:31:17 PM EDT
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What percentage of your monthly income should someone budget for savings? 10%? 25%? 50%? What is a good rule of thumb? |
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You have already received some good advice and yes every body's situation will be different. Here is my twist. Build up a savings that will pay your expenses for 6 months just in case you lose your job, get injured, laid off. Even if you have a solid job you just never know. Then use ALL of your left over money, after bills, to pay off collage loans, credit card debt, car, and mortgage. In that order. You don't need to live like a poor person just be careful and hold back a little. For example don't get the supersize meal, don't get wings just because you need a little extra. Food bills are horrible, eat out less.
Bottom line is once you have your debts paid off you will feel unbelievable freedom and then when you start saving it will grow quickly. I/wife did this about 2-3 years ago. Paid off the cars first then went for the mortgage. Finished a 30 year loan in 13 years I think. It can be done and it wasn't that bad. Just another option. |
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Depends on your circumstances, but here's the trick: Take that money out first. Don't wait till the end of the month, then save what's left over. Decide how much you want to save, then have that amount automatically transferred to whatever investment or savings account you're using. Then you live on what's left.
Pay the savings first. |
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Quoted:
And five-star restaurants pay you to take your supermodel girlfriends there, amirite? Quoted:
Quoted:
This is Arfcom, So I save 110% while paying cash for my mansion and sports cars.  And five-star restaurants pay you to take your supermodel girlfriends there, amirite? You know it! 
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Quoted:
You know it! Quoted:
Quoted:
Quoted:
This is Arfcom, So I save 110% while paying cash for my mansion and sports cars. And five-star restaurants pay you to take your supermodel girlfriends there, amirite? You know it! We get standing ovations from the jurors box. |
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Quoted:
You have already received some good advice and yes every body's situation will be different. Here is my twist. Build up a savings that will pay your expenses for 6 months just in case you lose your job, get injured, laid off. Even if you have a solid job you just never know. Then use ALL of your left over money, after bills, to pay off collage loans, credit card debt, car, and mortgage. In that order. You don't need to live like a poor person just be careful and hold back a little. For example don't get the supersize meal, don't get wings just because you need a little extra. Food bills are horrible, eat out less. Bottom line is once you have your debts paid off you will feel unbelievable freedom and then when you start saving it will grow quickly. I/wife did this about 2-3 years ago. Paid off the cars first then went for the mortgage. Finished a 30 year loan in 13 years I think. It can be done and it wasn't that bad. Just another option. Good post, but the part in red is stupid. Pay off whatever has the highest interest rate first. Period. I aim for about 25%. 10% in cash, 6% in retirement. 4% in other assets and about 5% is "preps". |