When do people spend their savings?

You should have saved this much money at any age

Saving money is easier said than done. But there is no getting around it: For a financially secure future you need to have some reserves at the bank.

For most people, putting some money aside every month is doable. After all expenses and taxes, the average US citizen can save 3.5 percent of their income. This has been determined by the US Bureau of Economic Analysis. In Germany, around every second saver puts aside between 50 and 200 euros a month.

That’s better than nothing. One thing is clear: In order to achieve the ten or 15 percent reserve ratio recommended by investment experts every month, you have to get involved. It is not always possible to save money - for example not if you have just lost your job or have to pay expensive medical bills.

But in some times you can save more for it than you can at the moment. In any case, it is worthwhile to take a close look at your expenses and to cut back a little in some areas so that you can invest your money in more important things.

If you need a boost in motivation to finally start saving, this graphic from the fund provider Fidelity should be of interest to you. It shows how much money you should have on the high edge in which phase of your life in order to lead a financially carefree life in old age.

For example, by the time you're 30 years old, you should have an amount around the same as your salary. Five years later, at the age of 35, your savings should already be twice as high as your monthly wages. If you continue your financial plan every 5 years, you should have saved around eight times your salary by the age of 60.

Remember, these are guidelines only. The good thing about it: You don't have to turn every single cent twice to reach your goal.

Those who invest can let their savings grow

Your savings will grow exponentially as you invest the money you save. Investments can be risky - your account balance will drop in between. But as long as you are not in dire need of the money (and it will take a long time to reach your retirement), you will have enough time to enjoy the benefits: namely when the stock market grows again.

By saving a little more and making sure you invest too, you have an impetus to save even more in the future. It should be worth it if you can lie on the beach for it during your retirement.

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