How to save for the future

Mr Tan

I have just started work and earn a salary of $2,000. I find it difficult to save, as there are so many expenses to take care of. How much should I save, and how?

My reply:

You should aim to save 10% to 20% of your salary. You can save by cutting down on your luxury expenses, such as mobilephone bills, fashion and entertainment.

You have to meet your mandatory expenses, such as:

* pay off your education loan
* travelling, food and other expenses needed in your daily work
* monthly contribution to the household expenses

This allows you a balance to set aside for your savings.

You can use the remainder for your luxury expenses.

For your savings, you should invest in a large, well diversified fund with low charges. NTUC Income offers this option. You can also look at some mutual funds or unit trust that offer this facility.