How much money I need to save up to build wealth.
In order to get a good feeling of how much money you need to have saved up in investable assets we will address a general guidance within 5 age groups. We will look at what you should have in assets when you are in your 20’s, 30s’s,40’s,50’s and even in your 60’s before you enter into retirement. There is no completely true formula to follow as many things have to be taken into consideration but having a guideline will help you see where you are at on your path to creating a healthy personal financial balance sheet and it can help you see if you have to start speeding up your savings or see if you are saving enough. The chart below gives guidance on where you should be at with your investable assets excluding your personal residence.
|In your 20’s: Assets of less than 1x income|
|In your 30’s: Assets approaching 1x income|
|In your 40’s: Assets approaching 3x income|
|In your 50’s: Assets approaching 5x income|
|In your 60’s: Assets approaching 10x income|
In order to achieve important lifetime objectives, it is important that your assets grow over time. If your Asset/Income ratio as defined above is not optimal you need to consider looking into ways of optimizing your overall financial picture and looking at ways to increase your savings rate. That includes looking at debt consolidation and debt reduction options, minimizing taxes, increasing the overall rate of return and looking at more efficient low-cost ways to build and maintain an optimal protection portfolio.
To learn about where to save and how to build wealth take a look at the article that talks about the top 10 ways to build wealth.
Written by CreativeNurse Team
This material contains the current opinions of the CreativeNurse but not necessarily those of Guardian or its subsidiaries and such opinions are subject to change without notice.
2016-24475 Exp. 6/18