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Money Q&A: How Much Should You Be Saving?

Q.

I read that last year's national savings rate was negative. How much should we be saving? I heard we should put away 10% of our salary.

A.

You heard right: The current overall savings rate in the US is -0.5%, meaning that people spend all of their after-tax income and then some. To figure out where you should invest your 10% (or 20%, or 2%, or whatever you can handle), start by figuring out what you need for retirement, then work backword starting with your biggest goal, be it grad school tuition or a trup to Europe. ChooseToSave.org can help you get started, and find a financial planner who can walk you through the basics of building a budget. You don't have to be rich to use one - interview a few paid-by-the-hour planners and choose one who speaks your language.

-- The Nest Editors

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