We all know that we should be saving money, but we do not always do it. We have 1 million excuses for why we don’t, but how many of those are valid? The fact of the matter is, we should be saving money. It’s not about the here and now, it’s about our future. We need to make sure that when we get older, we don’t have to keep working and breaking our back when we’re tired and just want to relax. You can put your mind at ease by putting money to the side, but how much money should you be saving?
How Much Money Should You Be Saving?
How much you need to put away is relative to many factors. Age is key to figuring out how long you need to save until retirement. From there, you have to figure out how much money you will need to live on each year after your retirement. Those numbers are the basis of your savings goals and strategies for today. You can use a nifty calculator like this one to help see your exact number. Now a vast majority of you will say the savings rate is too lofty amidst low wages, and I agree. I do not save in accordance with the figure on the calculator, and it’s okay if you do not as well.
Save what you can, when you can. It’s best to get started and start with small savings goals. If you can only spare $5 a week, then do that. You can work your way up to a larger goal. I started saving by only rounding up change using the Acorns app. Later, I started contributing 5% to my 401k before spending $40 a week on my Stash Account. Over the years, I have upped my contributions to match my current goals and salary. All you need to do is get started and save at a rate that works for you.
Where Should I Save My Money?
There are a lot of places you can save your money, just don’t choose to hide it under your mattress. I have my money spread out in different accounts, even though you do not have to. For emergency savings, I suggest a high-yield savings account. For investments, I would try a 401k through your job and a Roth IRA first. These types of accounts are tax-advantaged. If you’re looking to go small by making fractional share purchases, I suggest using Stash.
There are lots of reasons to save. Get started today, and your future self will thank you later.
Shatel Huntley has a Bachelor’s degree in Criminal Justice from Georgia State University. In her spare time, she works with special needs adults and travels the world. Her interests include traveling to off the beaten path destinations, shopping, couponing, and saving.