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For many people, saving money is not exciting; when they consider what their savings may allow in the future it can become more exciting. This may mean the chance to have an expensive family holiday or a more comfortable retirement.
Whatever your level of salary or wages, you should aim to save 20% of your earnings. Depending on where you currently are in terms of your financial health, this 20% figure could seem insurmountable or very manageable. Please remember this is a guideline.
This guideline is based on the following breakdown of income; 50% on mandatory expenditure including accommodation and associated bills, 30% on discretionary expenditure and 20% on savings.
Is this the Dream versus Reality?
The chart above is from Trading Economics and clearly demonstrates that in the UK most households are not getting anywhere near the 20% figure. My own anecdotal evidence is that there are times when I have been able save above the 20% and other times when no saving has been possible at all.
For our US readers, the situation is actually slightly worse, as you can see from the chart below. There is data from other countries as well on the website, so please explore to find figures for your country if you are not from the UK or US.
I would like everyone who reads this post to take a step forward to a better financial future. We have just started a new month, commit with me to saving 20% of your income, or as close to that as you can. If you comfortable doing so, leave a comment below indicating the percentage of your income that you will save this month, this month being June 2018.
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My aim with each blog post is to help you move to a better financial future. I believe that financial education is largely absent from the national curriculum and I intend to share anything helpful that I have learned along the way. I am by no means a financial expert. This is my personal finance blog; my marketing blog is over here and I have been blogging there since 2010.
I hope you have found this information useful. Thank you for reading.