Question

F a person is earning $34,923 per year, approximately how much should they be saving, including retirement and other savings?'

Answer 1

$6,984.60 per year.

Explanation:

Using a normal and very common budget, you should divide your monthly/annual salary into 3 main tiers, which are the following

• 50% = necessities (rent, food, bills, etc)
• 30% = lifestyle choices (clothes, entertainment, hobbies, etc)
• 20% = savings (retirement, emergency fund, etc.)

If we go by this budget then we would need to turn the 20% into a decimal by dividing it by 100 and then multiply that decimal by the person's annual salary.

20% / 100 = 0.20

$34,923 * 0.20 = $6,984.60

Finally, we can see that the individual should be saving roughly $6,984.60 per year.