Having savings is one of the main objectives to achieve financial stability. According to your age, there are some savings goals that you should meet.
As part of financial planning , it is important to identify two objectives: savings goals must include the emergency fund, with which to respond to an unforeseen event, such as an accident, illness or loss of employment.
The second goal to meet is longer term, specifically for retirement. In addition, it is recommended that you have that money in an investment account or in financial instruments so that it is generating interest, because over time the money depreciates.
Thus, it will also be much more difficult for you to use it for other things, such as going on vacation or some impulsive purchase.
Experts advise that you should reserve 20% of your salary for savings. This emergency fund should contain the money you need to cover all your expenses for at least three months.
If you have the possibility to save more, the ideal is that the emergency fund covers your expenses for between three and six months.
When it comes to saving for retirement, Kimmie Greene, a finance expert at Intuit, a company specializing in financial software, suggests that at age 30 your savings goals should be the equivalent of a year’s salary. That money must double every five years. With this you would have:
This, in addition to your retirement savings in your afore, since with this you make sure you have many more years of peace of mind.
Although it seems overwhelming to have savings equivalent to a year of your salary, in reality you would achieve it by saving only 20% of your income each month.
For example, if you earn 10,000 pesos a month, you should be saving 2,000 pesos each time. That means that a year you receive a salary of 120,000 pesos and your savings in a year should be 24,000 pesos.
Now, if you multiply those 24,000 pesos by five, that is, five years, you would have 120,000 pesos, or one year of your salary.
In the end, it would all be a matter of maintaining discipline every month and managing to save at least that 20%.
To achieve this, the suggestion is that you resort to financial instruments or bank accounts, there you can separate that amount of savings automatically and that you cannot access it so easily, so that it is not a temptation.
As you can see, it is about going little by little, each month and maintaining your efforts as long as possible, this will give you much more financial peace of mind which will be of great help for your well-being when you retire.
Set your savings goals and if at any point you can’t meet them, don’t give up, keep trying and you will see your finances grow over time.