What percentage of my after tax income should I save every month?
My after tax income (including bonus and interest income) is approximately US$325K per month. I am a professional and my job is relatively steady (been with the same company for more than 5 years). What percentage of my after tax income should I be saving (either for retirement or a rainy day)? Obviously, it is better to save as much as possible. But I guess I want to know what percentage is a prudent guideline. Thanks
If you start putting away $100 a month at the age of 25 you will have at least a million by the time you hit your mid 50's depending on what kind of interest you have. A 401K is best, my husband and I put $200 in it a month and have accrued over $16000 in just three years.
1I try to put 10% of my take home pay in my savings account every week.
2You say your MONTHLY pay is around $325,000. MONTHLY? What are you? A baseball player? You should be able to save 50-60% of that if not more. $325K means $325,000. Do you mean $3,250? Geesh, ask your question correctly.
Anyway 8-10% of your gross pay is a good gaol to have. Depending on your tax bracket that would be aorund 10-15% after taxes.
310% of after tax income should be saved each month at minimum. If you can save more than do it. The best would be to use mutual funds for long term rainy days and money markets and CDs for short term rainy days and emergencies.
Hope this helps.
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