How Much of My Paycheck Should I Save?
Before asking yourself how much you should be saving, start by defining what you are saving for.
Savings Calculator
Calculate your savings growth by factoring in monthly payments and compound interest.
Emergency fund
A savings account set aside for unexpected expenses or financial emergencies, typically covering 3-6 months of living expenses
Compound interest
Interest calculated on the initial principal and also on the accumulated interest of previous periods. It helps savings grow faster over time.
Annual Percentage Yield (APY)
The rate of return on a savings account or investment, taking into account the effects of compounding interest over a year
Share Certificate
A fixed-term savings product offered by credit unions, similar to a CD, that pays a guaranteed interest rate over a set period
Certificate of Deposit (CD)
A savings product with a fixed interest rate and maturity date. Funds are locked in for a specific period, usually offering higher interest than regular savings accounts.
High-Yield Savings Account
A type of savings account that offers a higher interest rate than standard savings accounts
401(k)
A retirement savings plan offered by employers, often with contributions that are matched to a certain degree
Roth IRA
A type of IRA where contributions are made with after-tax income, but withdrawals during retirement are tax-free
All About Investing
Why It's Important to Start Investing in Your 20s and 30s and How to Begin
The earlier you start saving for retirement the better off you’ll be. Investing in your employer-sponsored retirement plan and hiring a financial advisor will help you get there.
Savings Frequently Asked Questions
The standard for a healthy emergency fund is to have enough cash set aside to cover between three and six-months' worth of basic expenses.
This budgeting rule suggests allocating 50% of income to needs, 30% to wants, and 20% to savings or debt repayment.
A few ways to save money fast include cutting non-essential expenses, selling unused items, setting a strict budget, and automating savings from your paycheck.
Create a budget, reduce unnecessary spending, and automate transfers to a savings account as soon as you get paid.
A money market account (MMA) is a savings account that typically pays higher interest rates than regular savings accounts. MMAs usually offer tiered rates, meaning you can earn an even higher rate on large balances or on part of your balance over a certain level.
Experts recommend saving between 10 and 15% of your income for retirement, starting as early as possible to maximize compound growth.
This rule suggests saving four times your annual income by age 60 to ensure a comfortable retirement.
Consider high-yield savings accounts, Share Certificates, or money market accounts, and compare rates regularly to maximize returns.
FinLit Quiz
What’s the Best Savings Account? MMA, CDs & Regular Savings Explained
Choosing the best savings account can be a great tool for helping you achieve your savings goals. Cesareo from OneAZ explains the difference between savings accounts, money market accounts, and Share Certificates so you can choose the best savings account option for you.
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