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How much of your salary should you save?

1 min. read

So you just started work. How much of your salary should you save?

There is no hard and fast rule.

While the simple guideline is 10-20% of your salary, it really depends on how fast you’d like to reach financial freedom. To speed things up, you might want to add in another 5-15% more to attain your goals in a shorter time.


Some experts suggest the 50/30/20 rule.

That’s 50% of your monthly budget allocated to essential items such as housing, food and transport; 30% towards lifestyle choices; and the remaining 20% towards savings or investments. If you are able to save more, gradually increase the amount of your savings until you feel comfortable.

Deciding what’s essential or a lifestyle choice can be confusing at times, right? For example, is food considered an essential or a lifestyle choice?

Here’s an easy test: Ask yourself if your spending is a result of social activities.

If you pay for food, drinks and transport during a night of revelry, this is more likely a lifestyle choice than a necessity.

Pro-tip: Track your expenses.

There are lots of mobile apps that can help with tracking your finances. Choose the one that is easiest to use. Diligently logging your finances can help you see where your money is going, what needs to be cut down on and whether your savings are on track.

Last updated on 13 Mar 2023