There is no way around this step. You need to save, which will require financial discipline, but it is not unreasonable to do like so many believe it to be. After you get in the habit of saving, it becomes second nature; the first step to getting here is to start saving regularly.
:: How much should I save out of my income?
There is no magic percentage that everyone should use because each person’s financial situation is different, but many sources suggest saving somewhere between 10–25% of your income. Start small and gradually build your way up to saving a higher percentage. The earlier we start saving, the better off financially we will be.
:: How much money do I need for retirement?
This will depend on you and your needs. You need to ask yourself a few questions that will help you determine how much money you need for retirement. See below.
:: At what age would you like to retire?
Knowing this will help you determine how many years you have left to save; furthermore, it will also help you figure out how aggressive your savings and investing strategies need to be.
:: How long do you anticipate you will be in retirement?
The answer to this question will help you determine how much money you need to save.
:: How much money do you expect you will need per year in retirement?
Use an inflation calculator to help you adjust for inflation.
After you have answered all of these questions, search a retirement calculator and input your figures; this will help give you a ballpark range of how much you need for retirement, and how much you need to save now to reach your goal retirement figure.
The least stressed people in a recession are those who have money in the bank; it’s the people who have saved their money and do not have to be concerned about financial strain or job loss. In a recession, these people might not even feel they are in one. They might lose money from the stock market plummeting, but they have reliable savings that provide confidence and cushion for them for extended periods.
Save your money even when it is uncomfortable. You will thank yourself for this over and over again.
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