ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Saving 15% of one’s salary towards retirement is sufficient, which can be increased gradually later.

Detailed explanation-2: -“A good rule to live by is to save 10 percent of what you earn, and have at least three months’ worth of living expenses saved up in case of an emergency.”

Detailed explanation-3: -A good rule of thumb is to aim for saving at least 10-15% of your income each month. This will help you build a solid financial foundation and give you the ability to reach long-term goals such as retirement or purchasing a home. If you are able to save more than 15%, that’s even better.

Detailed explanation-4: -At least 20% of your income should go towards savings. Meanwhile, another 50% (maximum) should go toward necessities, while 30% goes toward discretionary items. This is called the 50/30/20 rule of thumb, and it provides a quick and easy way for you to budget your money.

Detailed explanation-5: -But how much is enough? Our guideline: Aim to save at least 15% of your pre-tax income1 each year, which includes any employer match. That’s assuming you save for retirement from age 25 to age 67. Together with other steps, that should help ensure you have enough income to maintain your current lifestyle in retirement.