I was recently told by a financial adviser about a rough outline for retirement, that if you save 20% of your income for 20 years, you can retire on your current standard of living (and that % includes money going into your 401k, plus your employer's match). I chewed on that for a few days and took it one step further: How much do I need to save per week to bump up my savings percentage by one point?
The math is really simple. If your take home pay is $40,000 per year, then 1% of your income is $400. Divided by 52 weeks, that number is $7.69 per week. That's it. If you're in a "squeeze more water from rocks" situation, that low, low number feels much more achievable.
You can of course change the math around for a monthly calculation. At $40,000, the amount to save 1% of your income is $33.33 per month. The top post today is about someone who cut Netflix and Hulu out of their life. If they had the standard tier of each ($11 + $8), and if their take-home pay is $40,000, then they saved .58% of their yearly income.
I thought this idea was really powerful, so I thought I'd share.
January 11, 2018 at 04:23PM
