Income Allocation 101: How Much Should I Save?
Many individuals in the personal finance community preach the importance of asset allocation. But before you can balance assets across different portfolios, you must decide how much of your income should be allocated within these accounts. And before your decide where to put your money, you need to determine how much of your income you really have to allocate.
Welcome to Income Allocation 101: How Much Should I Save?
Personal Finance gurus love using the “rule of thumb” when it comes to gross income savings. Some say 10%, others say 20%, but this percentage is really the sum of several savings categories:
- Retirement
- Emergency Savings
- Child Education Savings/Other Savings Goals
Income Allocation 101 will use calculators to show how to estimate the amount you will need to allocate in each of these categories, which will ultimately provide a total savings goal. I will dedicate one lecture (post) to each savings category. After completing this course (series of posts), we will be able to replace some of the assumptions in our savings model to craft a more accurate income allocation plan!
March 4th, 2008 at 6:46 pm
[…] Ushcustomernotes.com wrote an interesting post today onHere’s a quick excerpt Many individuals in the personal finance community preach the importance of asset allocation. But before you can balance assets across different portfolios, you must decide how much of your income should be allocated within these accounts. And before your decide where to put your money, you need to determine how much of your income you really have to allocate. Welcome to Income Allocation 101: How Much Should I Save? Personal Finance gurus love using the “rule of thumb” when it comes to gross […]
March 9th, 2008 at 9:36 pm
[…] Income Allocation 101: Emergency Savings Mar.07, 2008 in Increase Revenue In the last lesson (post) we managed to cover the basics of allocating income to retirement accounts. Nearly all experts agree that retirement savings should be the first priority when it comes to income distribution. The next most important savings category is emergency savings; lesson two in our three part series. […]
March 26th, 2008 at 12:32 am
[…] that all readers have successfully passed Income Allocation 101, we are ready to explore the second funnel your money trickles into, expenses. The first lesson […]
June 26th, 2008 at 2:00 pm
[…] learned in the last lesson how to find the base amount for your budget: total income minus savings allocation. Now it is time to cover how to create a budget with this budget […]