Personal Savings Strategies Assignment Example | Topics and Well Written Essays - 500 words

Personal Savings Strategies - Assignment Example I can possible save over $50 a month if I control my impulsive buys. My gasoline expenses are high because my SUV vehicle wastes a lot of gas. I could invest in acquiring a hybrid vehicle that gives at least 40 miles per gallon. My gasoline expenses would be reduced by at least 60% by acquiring an economical vehicle. My personal savings plan starts by establishing a realistic goal of how much I must can save based on my personal expenses. My personal income is $2000 a month. I must add my variable and fixed expenses to determine a budget that exceeds my expenses. People that spend more than what they earn are always in debt because they finance their excess living expenses through debt instruments such as credit cards. The table below shows my financial personal plan based on my income and expenses. The budget above is my best estimate of my monthly expenses. The two tactics I’m going to use are lower my clothes and entertainment expense by $50 and to lower my gasoline expenses. I will trade in my SUV for a used vehicle that gives 40 mpg. The value of my vehicle is above $20,000, thus I have some options to achieve my goals without having to increase my budget by buying a new car. I expect to obtain a gas savings of 60% which would lower my monthly gasoline expenses from $300 to $120 month. The new budget of the next five years is illustrated below: My new monthly budget will allow me to save $230 a month. My total yearly savings are $2760 a month. A conservative estimate for the next five years is that my savings will continue at the same rate for the next five years. The reason that the estimate is conservative is because my income will increase due to a higher level of educational attainment. The same assumption will be applied for the 10 year and 20 year financial goals. Based on a 2% interest in savings for the next 5 years my