How Much Should I Really Be Investing Per Month? Find Out Now

Introduction:

We often hear the classic financial advice: “Save at least 20% of your income." It's a solid starting point for building wealth, but in reality, some financial goals demand more aggressive saving. If you're planning for early retirement, a major life event, or multiple goals at once, that 20% may fall short.

We’ll explore what to do when saving just 20% isn’t enough. You’ll learn how to increase your savings rate, prioritize your goals, and use practical strategies to stay on track.

Summary

1. Why 20% Isn’t Always Enough
2. Two Smart Strategies When You Need to Save More
3. Real-Life Example: Prioritizing with a $30,000 Monthly Income
4. Tips for Staying on Track
5. When to Work with a Financial Advisor
6. Tailor Your Savings Strategy

1. Why 20% Isn’t Always Enough

While the 20% rule works for many, it's not a universal solution. Here are some scenarios where saving more might be necessary:

• Big life goals like buying a home, starting a business, or retiring early.
• Tight timelines, where you want to reach your goal in a few years, not decades.
• Multiple financial objectives you want to fund simultaneously.
• Catching up if you started saving later in life.
• Increasing your financial flexibility and peace of mind.

2. Two Smart Strategies When You Need to Save More

If your goals require saving more than 20% of your income, you have two main strategies:

1. Increase Your Savings Rate

You can save more by either reducing expenses or increasing your income.

Cut Unnecessary Expenses

• Review monthly bills and subscriptions
• Reduce discretionary spending like dining out and entertainment
• Try budgeting techniques like the 50/30/20 rule or zero-based budgeting

Boost Your Income

• Request a raise or promotion
• Start a side hustle or freelance job
• Monetize hobbies or skills
• Rent out unused space or assets

2. Prioritize Your Financial Goals

If saving more isn’t feasible, rank your goals by importance. This way, your top priorities get funded first.

3. Real-Life Example: Prioritizing with a $30,000 Monthly Income

Let’s say you earn $30,000 per month and decide to save 20% ($6,000) monthly. But your goals require a total of $10,928 in monthly savings. Here's how to apply a “scale of preference."

Your Goals:

• Retirement: $1,083
• Down payment: $1,575
• New TV: $666
• Certificate course: $802
• Vacation: $813
• Business startup: $5,988

Step-by-Step Allocation:

Result: You fully fund five out of six goals. You can only contribute 17.72% toward your business startup.

Combine Both Strategies

You don’t have to choose between saving more or prioritizing—you can do both.

Example:

• Increase your savings rate from 20% to 25% (now saving $7,500/month)
• Continue prioritizing goals based on importance

That extra $1,500 helps you achieve your goals faster or more completely.

4. Tips for Staying on Track

1. Revisit Goals Regularly

Your priorities may change. Review your goals every few months and adjust your plan accordingly.

2. Don’t Neglect Retirement

Always prioritize long-term savings. The earlier you save, the more compound interest works in your favor.

3. Build an Emergency Fund

Have 3–6 months’ worth of expenses saved before pursuing other goals.

4. Make Room for Enjoyment

Savings goals are important, but so is balance. Budget for things that bring joy to avoid burnout.

5. Use Tools to Track Progress

Apps like Mint, YNAB, and Empower make it easy to manage your savings plan.

5. When to Work with a Financial Advisor

If your financial situation is complex or you feel overwhelmed, consider hiring a Certified Financial Planner (CFP®). They can help you:

• Clarify and prioritize your goals
• Build a customized savings and investment plan
• Identify tax-saving opportunities
• Stay accountable

Look for fee-only fiduciary advisors to ensure unbiased guidance.

6. Tailor Your Savings Strategy

Saving more than 20% of your income isn’t just possible—it’s often necessary for ambitious financial goals. Whether you increase your savings rate, prioritize goals, or use a combination of both, the key is having a clear plan and staying consistent.

Action Plan:

1. List and quantify your financial goals
2. Calculate monthly savings needed for each
3. Choose whether to increase savings, prioritize goals, or both
4. Track your progress and adjust regularly

Start now, and let your savings work toward the future you envision. If it feels overwhelming, a trusted financial professional can guide you every step of the way.

Frequently Asked Questions 

Q1: Is it bad to save more than 20% of your income?
A1: Not at all. If your income allows it and you have multiple financial goals, saving more is actually a smart move.

Q2: What if I can’t even save 20% right now?
A2: Start small. Even 5% or 10% is better than nothing. The key is consistency and gradually increasing your rate.

Q3: How can I stay motivated when saving a large percentage of my income?
A3: Celebrate small wins, track your progress visually, and remind yourself why you’re saving—whether it’s financial freedom, a dream home, or early retirement.

Q4: Should I focus on debt or savings first?
A4: Prioritize high-interest debt first (like credit cards), then balance between savings and lower-interest debt (like student loans).

Q5: Can I change my financial goals later?
A5: Absolutely. Your goals should evolve with your lifestyle, income, and personal preferences.

Conclusion

Saving more than 20% of your income might feel like a challenge—but it’s absolutely achievable with the right mindset and tools.

Whether you choose to increase your savings rate, prioritize your goals, or combine both strategies, the most important step is taking control of your money and being intentional with your financial decisions.

Here’s your next move:

• List your financial goals
• Determine how much each one needs monthly
• Decide whether to increase savings, prioritize goals, or both
• Track progress and adjust every few months

And remember, if it ever feels overwhelming, a Certified Financial Planner (CFP®) can help you map everything out with clarity.

📌 Bonus Tip: Bookmark this guide and revisit it during your monthly or quarterly financial check-ins.

Important Note: Please Read Before You Invest

We're just sharing some helpful tips, but remember, investing comes with risks. We can't promise that these tips will always work or that you'll make money. Everyone's financial situation is different, so it's smart to do your research or talk to a financial advisor before you invest. Using these tips, you agree that you're responsible for your investment decisions and results.