How To Save Money Each Month: Some Ways To Stay On Track
Now if you are getting a good and steady monthly income then the first question that comes to your mind is – “How much should I save from my monthly income?” There is only one basic issue (question).
You can’t make that much money in one month or one year! That’s why you should commit even your small savings month to month for many years – only then will it pay off handsomely.
One of the most important saving steps you can take is to set your goals correctly – when it comes to saving (money) every month.
Yes, one month I saved $100…and then the next month I couldn’t even save $10 and you shouldn’t make excuses. Always set a savings goal of $80 per month ($20 per week) and stick to it regularly.
I have to save a certain amount every month – those who do not have a condition, add your income every month until possible. This will help you more when you are not feeling well when you are out of work due to heavy rains, and even during holidays due to worker strikes or factory improvement.
Let’s see how much money you can save every month.
What should you prioritize your savings?
Is it right that we prioritize savings as we need to save at least a small amount of money every month?
No matter if you earn a high salary at your job or find a higher paying job and work there – if you don’t have at least a small savings for yourself then “no matter how many thousands of dollars you earn” your money will only be spent.
That’s why we suggest that a monthly savings plan is very useful for you to move up in your life and get a financially stable place.
Not all periods of old age or retirement come early in life. So most people are less enthusiastic and put off saving money for their retirement. Little do they realize in their early days that this will lead to more disappointments!
Do you know something? 78% out of 100% of people in the US live on monthly income alone.
And 40% of the youth out there are struggling to arrange even $400 immediately in case of an emergency. The reason for this is that they do not have proper saving habits and lack financial knowledge.
If you have enough money in your hand or your name in the bank – stress will subside and even peace of mind will come to you 🙂
There is no compulsion here for you to use your savings for this or that. So try to use your money freedom only for the right need.
How much money I should save every month?
No one can say it so precisely. Because everyone’s needs are different and their monthly income is different, isn’t it?
However, there are some optimal methods for this…
A) Based on your personal financial goals, how much money should you save per month from your income?
As we said earlier – you should have your savings target from month to month as per your needs.
For example, if you are thinking of buying a new house – your monthly savings amount will vary depending on how many years you plan to buy it.
If you think you need to buy a new home in 10 years, you’ll need to save half (50%) of your income! No. If I buy in 20 years, your monthly savings amount will vary (ie decrease) accordingly. The same goes for your retirement timelines, by the way.
Want to retire at 50? Or retiring at 70? – You can decide this yourself depending on your monthly savings.
If you need to retire early you can contribute (at a higher rate) to something like a 401(k) or Roth IRA.
B) Start saving money for emergency needs.
If your plan doesn’t include emergency expenses, how do you manage them without taking out a loan?
What do we mean by emergency expenses?
Affected physical condition (in the family).
Vehicle repair costs.
Sudden work out of hand and so on.
To overcome all this save 3 to 6 times your income in your bank account. You can even save up to 12 months if possible!
C) What can be done if the monthly targets are not met?
If some emergency has drained your income – don’t stress about it.
Avoid this and try to save at least a small amount every month. If you save at a rate of $20 a week, you’ll have $1,040 in your hands over the year. Think of this space and many more ways for a good saving to be born.
Start looking for ways to increase your monthly income if possible.
Don’t get discouraged by the natural problems in life. Try to face it with confidence!
D) How much should you have saved at the end of the year?
The answer to this question depends on your life situation! If there are no emergency expenses in your life throughout the year, save a good amount.
E) How much savings should you have in the bank when you are 35 years old?
That’s roughly $34,780, according to the Federal Reserve.
If you were between the ages of 35 – 44 you should have $170,740.
If you are between the ages of 45 – 54 you should have $507,660.
To save money you must first learn to save. Be it clothing, or food, avoid buying luxury items, cut down on unnecessary trips, and travel only once a year.
You can use the free Investor.gov Savings Goal Calculator, Bankrate Simple Calculator, and The Calculator Site to find out how much money we’ve saved so far.
Also, if you want to set aside your savings for emergency expenses, use emergency fund calculators such as the PNC Bank emergency fund calculator, Ally emergency fund calculator, and Fifth Third Bank emergency fund calculator.
Sathish is a full-time blogger and freelance writer with a passion for side hustling, passive income, and the gig economy. True Home Occupations is all about providing people with honest ways to make and save more money by using technology. To learn more about Sathish, read his About Page!
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