How Much Should You Save a Month?
Figuring out how much should you save a month can vary largely depending on your financial goals.
This post is about how much should you save a month.
Let’s dive into the top 3 methods on how much should you save a month:
1. 50/30/20
Utilizing the 50/30/20 method is quite popular in that it places your income into different financial buckets that can help you budget.
Let’s dive into each category!
50: Needs & Necessities
The idea is that 50% of your total income will go to your needs and necessities. This includes housing, food, transportation, utilities, health insurance, and more!
30: Wants
30% of your total income is set to go towards your wants. This includes eating out, entertainment, clothes, concerts/festivals, and more!
20: Savings & Debt Repayment
20% of your total income goes towards your savings and debt repayment (if you have any). This includes saving for emergency funds, large purchases, retirement, and more! Debt repayment can include student loans, mortgage payments, car loans, and more!
2. Emergency Fund
A general rule of thumb for emergency funds is to put aside 3-6 months of living expenses. However, an emergency fund amount is and will be different for everyone. Make adjustments to your emergency fund as you see fit.
3. Adjust based on your personal situation
Now, putting money into your savings is a great opportunity to becoming more financially stable. However, getting to put money aside is also an opportunity, especially for those who don’t have to think about debt repayments. Therefore, the last suggestion is to adjust based on your personal situation.
To reiterate, the top 3 how much should you save are:
- 50/30/20
- Emergency Fund
- Adjust based only our personal situation
