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April 18, 2020 by: Ryan

What is the $1,000-a-Month Rule?

There are lots of great “rules of thumb” you can apply when saving money for retirement. Even though there are many good strategies for this stage of your life, a popular tip you might want to consider is the $1,000-a-month rule. The rule goes like this: for every $1,000 a month you want to have during retirement, you need to save $240,000. Let’s take a look at how this will work out, assuming the withdrawal rate is 5 percent. So, with $240,000 x 0.05 = $12,000. Dividing this number by 12 gives us $1,000 each month. Having this cash is important because it gives you a bit of wiggle room each month. There are many things you can do with an extra thousand each month, such as:

  • Supplementing income from a part-time job
  • Adding to your Social Security income
  • Complementing any other streams of income you have

Depending on how much you are getting from your part-time job or Social Security, the multiples of $240,000 will differ. The rule itself will not vary, but if you want more than $1,000 a month, you’ll need to save more than $240,000.

How to Save Enough Money

This tip will only work if you’re putting enough into your investment accounts. Whether you have a lot or a little saved, now is the time to start seriously putting money aside. If you are behind, consider making some lifestyle changes so you’ll have more for retirement. One of the biggest obstacles when it comes to saving is debt. Many people find that once they’ve made their monthly mortgage, student loan, or car payments, there isn’t much left for savings. However, if you can get your debt paid off, everything that was going into payments can now go toward your retirement. For example, refinancing your student loans is one way to pay education debt off sooner. Many people qualify for lower interest rates, reducing each monthly payment. For all debt, consider paying as much as your income allows you to each month. Once you have everything paid off, it’s time to ensure that your savings will last through retirement.

Making Your Money Last

You’ll want to be able to withdraw the 5 percent from your accounts without running out of money. One way to do this is by investing your income, which will give a consistent cash flow from the investments. This can come from interest, distributions, and dividends. Using an investing strategy to help your portfolio generate returns will ensure that the $1,000-a-month strategy will work. Stable investments such as bonds help your savings make you money. This strategy also leaves room for you to not earn interest for a period. If your retirement savings are invested in cash, they might not yield anything for a while. In this case, you can still withdraw 5 percent, and the funds will last for 20 years. However, if there are any gains in the market, you can use this time to invest wisely. That way, your funds can last longer than 20 years, and you can leave something for your children.

 

7 Timeless Sports Console Games From The Past Two Decades

March 1, 2023 By Ryan Leave a Comment

Console sports games are still a hit with their core user base and continue to gain ground as newer models outpace decades-old technology like the early Nintendo consoles. Despite the newer tech and better gameplay on offer, a lot of the older sports console games have become firm favourites with newer gaming generations. This post rounds up some of the top sports console games of

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Environmentally Friendly Cryptocurrencies To Invest In

February 14, 2023 By Ryan Leave a Comment

Currently, it seems like almost every business practice is in some way harmful to the natural environment of our planet. The crypto industry is certainly not exempt from this negative environmental impact as many crypto mining projects consume high amounts of electricity. Industry experts, leaders, and engineers are aware of this problem and are working hard on projects that are more eco-friendly. There are a

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Useful Sports Betting Tips For NCAA Football Enthusiasts

January 26, 2023 By Ryan Leave a Comment

NCAA college sports, and particularly football, has become incredibly popular in recent times, attracting masses of fans and leading to a huge surge in spectatorship, as well as sports betting. Read on for some pro tips could help give you a winning edge. Taking Advantage In The Early Season Oddsmakers are skilled at predicting how the public will bet and set their lines accordingly. Though

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December 29, 2022 By Ryan Leave a Comment

As the New Year is upon us, everyone is looking to change something in their life, to make it better. Although you can’t find happiness in objects, you may be surprised how much acquiring a time lapse camera will increase the quality of your life, personally and professionally. Here is the explanation. On a Professional Level Let’s start with work. Whether you are independent or

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About

Hi guys! I’m Ryan. I am a recent graduate from a Journalism program and have a huge passion for writing. I am also the editor of Get Under Skeleton.

A little bit about me is that I love learning about all things and I am always inquiring and asking questions about,

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Popular Posts

  • NYC Event Planners Make Life Easier For Summer Corporate Conferences, Parties, and More
  • 7 Timeless Sports Console Games From The Past Two Decades
  • Environmentally Friendly Cryptocurrencies To Invest In
  • Useful Sports Betting Tips For NCAA Football Enthusiasts
  • What a Time Lapse Camera can do for You (personally and professionally)

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about me

Hi guys! I’m Ryan. I am a recent graduate from a Journalism program and have a huge passion for writing. I am also the editor of Get Under Skeleton.

A little bit about me is that I love learning about all things and I am always inquiring and asking questions about, Read More…

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