![]() Looking at it in terms of average personal net worth does not paint a much prettier picture. According to this recent article, about half of all American households have no retirement savings whatsoever. Wow – 20%! That’s a big number to carve out of every paycheck for savings, right? I’m now 46 years old and I can tell you that I have definitely NOT been following the 50-30-20 Rule when it comes to my retirement savings plan.Īnd it appears that not many other people are following the 50-30-20 Rule either. This rule states that when you get your paycheck, 50% of your money should go toward necessities, 30% of your money should go toward discretionary spending or “nice to haves” and 20% of your money should fund retirement. ![]() ![]() And like many complex questions, it’s natural to look for rules of thumb to help with your decision-making.Ī popular guideline is the 50-30-20 Rule, first introduced by Senator Elizabeth Warren in her book All Your Worth: The Ultimate Lifetime Money Plan. ![]() It’s a complex question that depends on many variables. The question, “How much of my paycheck should I save each month?” is probably on your mind when you think about saving for retirement. ![]()
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