The way you see money changes as you grow at one point you were little and
had no worries about money at another point you became aware of the fact that
you must have money to buy the things that you need your understanding of
money will soon go beyond what you need to have now you'll start to think of the
future and how you have to have enough money when you stop working this brings
up several questions about money you want to know how much of it you should
be making right now and even how much of it you should be spending well there are
no definite answers to these questions but only rules that may help you make
the right decision let's face it you're not going to be working forever you will
have to retire one day and you will want to know the amount of money you will
need to save to have a secured retirement and also what financial goals
you need to meet at each stage of your life and in this video I will share with
you how much you should have saved at every age and if you're new to the
channel then hit the Subscribe button below for more life-changing content
when it comes to money everyone knows how to spend it but only if you know how
to keep it that is why so many people struggle with money they know they need
to save some and then spend the rest but the question is how much should you save
the answer to this question is not as simple as you may think there are
several factors that come to play when it comes to how much money one needs to
save for example if you are married with kids you may need more savings than
someone who is not married and has no children it's important to know that we
are talking about long-term savings which are also retirement savings this
is the ultimate goal of most people as they are looking forward to having a
comfortable retirement only a few people have enough savings for retirement for
numerous people a small emergency will arise in all their savings will be wiped
out and they may even be forced to go into debt so if you're saving towards
retirement you need to know how much you need to save over the years luckily it
is easy to estimate how much money you will need for retirement There are rules
that can guide you in make the process easy for example the 25 times rule
explains how to save enough money for your retirement that is you should save
at least 25 times the amount of your current annual expenses but what about
the time before retirement how much money do you need to save at each stage
of your life before retirement to be able to reach your financial goal these
stages are called Financial milestones and there are certain rules that will
guide you to save enough at each stage Financial Milestones are the financial
goals that you have they are the money goals that you want to reach by the time
you're at a particular age it also explains how your priorities change as
the years pass your financial need when you are 20 years old will be different
from your financial needs when you were 40. these Milestones are usually divided
into a range of about 10 years as your life typically deviates in this amount
of time in this video you will learn about six different Financial Milestones
that will help you determine how much you need to save at every age this rule
may not work for everybody as the conditions may be different but the
important thing is to have a plan for the future and make adjustments as
needed it is also important that you do not see the target as an exact amount
but as a guide this will make it easier for you to reach your savings goals
faster the target is a range of values that has been calculated as the average
savings of people in that age group however the circumstances may be
different and what applies to some people may not apply to you so it is
best if you see the amount as a percentage instead that way you will be
able to save enough money for your retirement so how much money should you
have saved in your 20s this is the first Milestone and it is from the ages of 20
to 29. your early 20s are probably a time where you're just getting out of
college and are looking for a job if you're in your early 20s it's okay if
you don't have any savings because most people of that age don't if you have any
amount of savings at the stage I want you to know that you are doing better
than a lot of people one of the reasons why it may be difficult to save during
these years is because you are likely still deep into debt and servicing
student loans another reason why it may be difficult for you to save at the
stage is that you don't have a means to Simply put you may have yet to have
started your career this stage however is the best Stage to start saving if you
start soon enough the benefits will be more than when you start saving in the
other milestones in your early 20s you may start with saving as low as 10 of
your annual income but you should increase the number to 25 percent as you
get to your late 20s you should get an individual retirement account or IRA to
start saving up for retirement also you should have an emergency fund that is up
to three months of your income this is the best age to start learning about
budgeting to know how to manage your finances but what about your 30s by this
age you should be entirely on your own and not dependent on others that means
you should have enough money to pay your living expenses and all your other bills
you should also have cleared off your student loans at this age as most people
report that student loans affect their financial life and make it difficult to
save however if you haven't cleared off your debt yet then you should at the
very least have a robust plan that you can follow to do just that at this
Milestone you should increase your savings and make sure you have at least
50 percent of your total annual income save for retirement and you should
increase it to a hundred percent with time this means that at this stage your
goal is to have the minimum amount of money that is equal to your annual
salary and a retirement savings account at this stage most people are either
married and have kids so it is important that you should increase the amount you
save if possible this will speed up the growth of your money through compound
interest moreover you should have an emergency fund that contains one year's
worth of living expenses to cover any unforeseen events this way you can focus
on investing more and building a retirement account you should consider
investing in an HSA and 401k and setting up a savings plan for your children's
education and also aim to have a credit score between 700 and 750. this is the
age where you should invest more and diversify your portfolio while learning
in order to stand out and make more money but what about your 40s at this
stage you are getting closer to the peak of your career and your salary should
increase too you should also focus on increasing your savings and Investments
as your income increases at this stage you should have at least three times
your annual income saved up for retirement while focusing on saving for
retirement you should still continue to cultivate your skills at work in order
to stay relevant to your field and ensure that your salary continues to
increase in your older age now let's talk about your 50s if you started
saving early then this is the Milestone where the results of compounding is very
noticeable your money begins to to grow more quickly than before because of
compound interest at this stage you are expected to have at least six times the
amount of your annual income in your retirement savings and the expectation
is that you continue to earn more and more money every year as you get raises
and promotions at work you should also still maintain that healthy emergency
fund containing at least one year's worth of expenses
but how much should you have saved at 60 years old this Milestone can be
rewarding if you have diligently followed your savings plan if you
started saving very early you'd have increased your total savings because of
the effect of compound interest you're getting closer to the age of retirement
and you need to clear up your debt to enjoy your retirement if you bought a
home with a mortgage loan you should have paid off everything at this age you
should also have at least eight times your annual income save for retirement
remember if you want to retire you should have at least 25 times your
annual expenses stashed away at this age and you should be earning at the peak of
your total career potential finally how much should you have saved at retirement
at this stage you are now ready to call the quits and enjoy your golden years
however that will only be possible if you have been diligent and saving over
the course of your lifetime at this stage you have access to your money and
you can withdraw from your retirement accounts without facing any penalty you
will also get some retirement bad benefits in Social Security but you
should have at least 10 times your annual income saved up for this stage
now that you know how much you need to set aside for each Financial Milestone
it is also necessary to know how to work towards it the first step in achieving
each Milestone is to budget your money you'll need to cut out unnecessary
spending this will help you save more money if you have any debt make plans to
pay them off as quickly as possible desk can really affect your savings as it is
difficult to save money when you still have debts to pay it is also important
to have an emergency fund in case any unexpected financial situation arises
the emergency fund should be at least three months of your monthly living
expenses and more depending on your age and risk tolerance finally think about
your savings as a long-term goal rather than a short-term goal this will help
you remain focused and disciplined to keep saving money make plans to save
enough money in each Milestone there may be times where you won't meet your
financial milestones for some reason it may be due to you not starting to save
early enough or having made some large impulse purchases luckily by seeing this
ultimate Milestone as a worthwhile Journey you can remain focused and take
the necessary actions to succeed in fact setting up these Financial Milestones
will offer you many benefits first it will help you Achieve Financial Freedom
Early it becomes easier to save towards your retirement when you have a
financial Milestone it breaks down your savings goals into smaller more
manageable targets you will know how much you need to save at each Milestone
and this makes it easier to work towards it also makes you think of savings in
percentages and not some number that may appear to be impossible to achieve not
to mention it's not feasible to set one number for everyone therefore the
percentage method simply makes more sense hey it looks like YouTube thinks
this next video is the one that will change your financial life forever give
it a watch end let's see if they're right