Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank or Stride Bank N.A.; Members FDIC

Saving Money

How Much Should You Save Each Month?

Should you put away a percentage of each paycheck? Keep reading to see some tips we’ve put together to help you save money and achieve your financial goals

Rebecca Lake • April 29, 2021

Saving money now can mean less stress later. There’s just one question: exactly how much should you save each month? 

The right answer ultimately depends on your personal finances. And we’ve got some tips to help find your savings sweet spot – so you can achieve all your money goals. 🤑

Consider what you want your savings to do

When you’re deciding how much you should save each month, understanding your money goals is a good place to start. Here are a few examples:

  • Saving for a down payment on a home
  • Setting aside money for a wedding
  • Putting cash away for your child’s future college costs
  • Getting a head start on retirement planning

How should you organize your savings goals? Think about each one as a bucket. You might have a bucket for your emergency fund, a bucket for retirement, a bucket for a dream vacation–again, it’s all about where you are today. 

Organizing your savings goals this way makes it easier to decide how to divvy up the money you have in your budget to save.


  • You’ve got an extra $1,000 a month to save. 
  • You have three main buckets you want to focus on right now: emergency savings, house down payment, and retirement. 
  • You could plan to put $250 into emergency savings, $250 into your down payment fund, and the rest into retirement. Or you could flip it around and put $250 into emergency savings, $250 into retirement savings, and the rest toward your down payment bucket. 
  • Then once that bucket gets filled, you can reallocate your savings between the other buckets. 

This strategy can make deciding how much to save each month easier because it’s easy to visualize where the money’s going. You can start with one big savings number, then break it down based on which financial goals are most important at the time. 

Try saving a percentage of your income

One of the most popular ways to use the percentage method is to follow the 50/30/20 rule for budgeting. 

Here’s how it works:

  • You put 50% of your budget toward essential expenses, like housing, food, and utilities. 
  • The next 30% is set aside for discretionary spending. So if you buy the occasional dinner out or shop online, those expenses would go in this category. 
  • The remaining 20% is split between debt repayment and savings. 

So, is 20% the perfect amount to shoot for when saving money each month? For some people, it might be. But it doesn’t always work for everyone. 

Example 1: If you’re just out of college, you may not be earning a lot yet or student loan payments take up a big chunk of the 20%. In that case, you might only be able to squeeze out 5% of your income for savings. 

But that’s okay! Just like with the savings bucket method mentioned earlier, you can tweak the 50/30/20 budget to fit your financial situation. 

Example 2: As you pay off debts you can shift some of your money over to savings – until the entire 20% is being saved each month. 

Example 3: If you’re earning a solid income, it’s possible that you might be able to save more than 20% of your pay each month. The key is deciding where to keep the money you’re saving to make the most of it. Putting some into an online savings account for emergencies and some into an investment or retirement account is something you might consider. 

Invest in your future self by saving for retirement

Whether you want to retire at 40 or you plan to work until age 70, you’re going to need some savings to live off of once you stop working. Here’s a really simple rule to remember about saving for retirement: time is on your side. 

What does that mean? It’s simple: The sooner you start saving, the better, as you’ll have more time to capitalize on the power of compounding interest. This means interest you earn on your interest and it’s a good thing for growing wealth. 

Example 1: The easiest way to start planning for retirement is to take advantage of your employer-sponsored 401(k) plan. Typically your investment comes right out of your paycheck, which means you get a tax break. Better yet, some companies match your contributions up to a certain percentage, and this is free money.

Example 2: If your company doesn’t offer a 401(k) or if you’re a freelancer, you can still save up for your retirement by opening an individual retirement account (IRA). There are many different types of IRAs so it’s important to do some research and find the best retirement savings vehicle for you.

Pay yourself first

Whether you decide to use the 50/30/20 rule to save money, the bucket method, or an entirely different approach, paying yourself first is a must for reaching your financial goals. This means that before you pay bills or treat yourself to a small splurge, you send some of your income straight to savings. 

One of the reasons why 69 percent of Americans have less than $1,000 in savings is that they are used to paying themselves last. Once the month is over and their bills have been paid, they realize there’s not much left over to put into savings. 

If you’re wondering how to get in the habit of paying yourself first, there’s a simple solution. You just need to sign up for a bank account that will help you automate your savings. 

Example: You can open a savings account through Chime and enroll in the Automatic Savings program. Each time you make a purchase with your Chime debit card, the amount is rounded up to the nearest dollar and deposited into your savings account. To take it a little further, you can also transfer 10 percent of your paycheck into your savings each time you get paid. Those are two easy-peasy ways to grow your savings, without even thinking about it.

How much you should save each month is up to you

Saving money doesn’t have to be a struggle. Even if you can only afford to save $50 a month right now, that’s enough to help you build a long-term savings habit. By putting these tips to work, you can figure out your ideal savings starting point and start stacking up cash. 

Banking services provided by The Bancorp Bank or Stride Bank, N.A., Members FDIC. The Chime Visa® Debit Card is issued by The Bancorp Bank or Stride Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa debit cards are accepted. The Chime Visa® Credit Builder Card is issued by Stride Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa credit cards are accepted. Please see back of your Card for its issuing bank.

By clicking on some of the links above, you will leave the Chime website and be directed to a third-party website. The privacy practices of those third parties may differ from those of Chime. We recommend you review the privacy statements of those third party websites, as Chime is not responsible for those third parties' privacy or security practices.

Opinions, advice, services, or other information or content expressed or contributed here by customers, users, or others, are those of the respective author(s) or contributor(s) and do not necessarily state or reflect those of The Bancorp Bank and Stride Bank N.A. (“Banks”). Banks are not responsible for the accuracy of any content provided by author(s) or contributor(s).

© 2013-2021 Chime. All Rights Reserved.