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One of the most difficult financial decisions to make is how much you should be saving for a comfortable retirement.  There are so many unknowns looking that far into the future that many people are so unsure of what to do that they do nothing at all.  Finding the balance between preparing for tomorrow and sacrificing luxuries today can be hard, but by following some simple rules of saving, you may be able to save enough for retirement while still enjoying the quality of life you desire today.

Financial experts recommend that between 10% and 20% of your income be put away for retirement savings and the percentage that you choose to save will depend on what you would like to do during your retirement and whether you will have any other sources of income during your retirement years.  Here is how each of those saving percentages will affect your retirement years.

10% Of Earnings Saved

Saving 10% of your current earnings for retirement should be enough to cover the basic necessities of your retirement years.  Saving 10% is recommended for those who anticipate having other income streams during their retirement years that will be able to supplement their retirement savings or plan on working part time during their retirement years.  10% of current earnings is a reasonable estimate for basic retirement necessities if you begin saving for retirement before you reach the age of 30, but if you begin later in life, you will need to add another 5% of earnings to your savings to make up for the amount not deposited in earlier years.

15% Of Earnings Saved

Saving 15% of current earnings in a retirement fund should allow you to maintain your current quality of life during your retirement years.  This amount should cover all of your regular household expenses plus enough for small luxuries like occasional meals in restaurants or trips to the movies. This amount is recommended for individuals that plan on relaxing or following inexpensive hobbies during their retirement years.

20% Of Earnings Saved

If you plan on spending your retirement traveling from state to state or seeing exotic locations, no less than 20% of your current earnings should be placed into your retirement account.  If placed into an interest bearing retirement savings account, you will have a significant amount saved for your retirement.  Traveling is expensive and gets more expensive every year so it is best to plan accordingly and save as much as you can to be able to live the lifestyle you would like after you have retired.

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