How much of your salary should you save?

Hi all. There are so many people out there telling us to save, get insurance coverage and invest. All 3 are important financial concepts. How do you all portion your monthly income into these 3 components? Do you segregate out money for these purposes and spend the remaining, or do you spend on what you need first, then split the remaining money for all these?

Lets hear different opinions from all walks of life!

6

Discussion (6)

What are your thoughts?

Learn how to style your text

Loh Tat Tian

07 Sep 2021

Founder at PolicyWoke (We Buy Insurance Policies)

If you have seen our videos for investment, you would roughly know that by growing about 30% of your money for 30 years, at a rate of 7% you would get 100% of the amount of money you earned. But that did not include inflation.

So what is a reasonable %? That would be determined by the returns and how much you would set aside. I believe in goal-based investing (and to sell a bit of koyok, Ifast do that), so understanding your

(1) Ability to take risk and

(2) willingness to take risk

would help.

Insurance should form no more than 10% of it as a guideline, and for savings... 6 months to 2 years of emergency fund is enough. The rest of the savings can go into investment if you do not have other goals.

Reply

Save

Tan Siak Lim

01 Sep 2021

CFP. Director, Financial Advisory Group at Financial Alliance

Rule of thumb. 5% insurance, at least 30% investment, less than 65% for living expenses. No need for further savings assuming you have saved enough for an emergency, which is about 6-12 months of living expenses. Individual situations might differ.

Reply

Save

Sherwin Lim

Edited 31 Aug 2021

I save on average 50-75% of my income. The remaining 15-25% I set aside for expenses.

The money I s...

Write your thoughts