Thursday, May 19, 2011

Saving a little from every paycheck

I have decided that in an effort to make sure that I am able to keep up with my dreams of someday being able to retire and see the world, I am going to drop 10% of my income into a savings account to be placed toward my retirement. So, on an estimated $1,000.00 a month income, I would put aside $100.00 into my savings account.

This would not be completely untouchable income, just a sort of insurance against future problems that might crop up. Over the course of a year, assuming an income of only $1,000.00 I would save an estimated $1,200.00 to be used toward emergency needs. In addition I would do something I had done in the past and any money left over from one pay period to the next would go into the savings account.

If I can just manage to save $1,200 per year, then my savings after 25 years would be $30,000 plus any interest that the bank would have added onto the savings.

With any luck that figure would be at last double if not triple that, but that would be under the best case scenario. I would be happy just to save enough to have a nice emergency buffer for getting new car tires or replacing my computer if it went down.