Unless you’ve got tens of millions of dollars in cash, and your monthly expenses are low enough to guarantee those funds will definitely last you for your entire life, you need to save and invest for today and tomorrow indefinitely. The thought of saving forever might sound like a lot, but it’s really just a habit you should develop as part of building a financially healthy life. 

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We’ve covered some frequently asked questions below.

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1. How much do I need to put away each month?

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There is no cut and dry answer to this. Some subscribe to the save 10% rule of thumb, but that may or may not be enough for you. If you don’t have a pension plan, or any sort of retirement savings program with employer-matched funds, you may have to save more than 10%. Many with a full pension plan will see their contributions are closer to 15%, even as much as 20% of their income between the employer and employee’s personal contributions. It can be very difficult to save that portion of your income all on your own. And that’s not including emergency savings. 

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So without a pension or any employer contribution, you should try to carve out more than 10% of your income for short- and long-term saving and investing. If you’ve got significant contributions between yourself and your employer, you may be able to save less than 10% of your income from your take-home pay.

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2. How do I find the money to save and invest?

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Start by looking at your cash flow, and set some goals you’d like to work towards with the cash you may be able to free up. If you don’t actually have any money left over from month-to-month, don’t worry. You’re not alone. And, that doesn’t mean you can’t find the money to fund your future, but you will have to change something to make progress. You can try working backwards, assuming you save 15% of your income, and find spending cuts equal to that amount. 

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Another strategy that might be easier to stick to is to figure out how much is safe for you to spend each week on the things you can control, and spend those funds from a separate account. For more on how to set yourself up for spending success, check out the episode on cash flow and spending from our Financial Capability Series and learn more about finding the money to fund your financial goals.

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3. How much do I need to save for emergencies?

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First of all, any savings is better than no savings. But to get yourself into a position to be able to truly roll with all of life's punches, you’ll want 4-6 months of expenses sitting in an accessible savings account. Look for a high-interest, no-fee account, if possible. Don’t get too excited about how high the interest is in those accounts. While they may increase during certain economic periods, it’s likely you’ll earn low single digits most of the time. Some years you’ll be lucky if the rate is a whole number. But some interest is better than no interest. Don’t be tempted to lock in emergency savings for a higher interest rate. You don’t want your emergency savings locked up in any way just to allow you to earn a tiny bit more because you may not be able to access it when you need it most. 

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Manage your expectations when it comes to building up emergency savings. Don’t expect to reach your goal of 4-6 months expenses in a few months. It will typically take years to build up an ideal emergency fund. Every month you’ll take a step in the right direction, and you’ll be more prepared for the unexpected. And, eventually, you’ll check your account balance and see you’re there. 

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Make sure you actually use your emergency savings when you have an emergency. Don’t be tempted to put it on your credit card where it’ll build up your debt. You’ll be more likely to exercise restraint in how much you spend on the emergency when you have to pay for it from your savings rather than put it on plastic. 

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4. How do I set other savings goals?

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We’ve covered emergency savings above, but you may have other short-term goals that you’d like to save for. In fact, it can be a powerful motivator to help you keep your spending on track if you’ve got a fun goal to work towards. 


When saving for non-emergency goals, you’ll want to choose something that you can achieve within 6-18 months without sacrificing your financial health. Set a short-term savings goal for something you really want. Maybe you want to go on a trip, improve your home, or buy a canoe? No matter your goal, saving for things vs. going into debt will make the reward that much sweeter.

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5. Should I take advantage of my employer's group retirement savings plan?

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Yes, it’s generally a major advantage you shouldn’t miss out on. If at all possible, take your employer up on any matched retirement savings programs. And it’s also a great idea to max out that program, at least up to the percentage your employer will match. It’s like getting an instant raise that you pay forward to your future self. For many people, taking advantage of these programs is what enables them to save enough for retirement, and still keep enough of their money to enjoy their lives too!

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6. I can stop saving for emergencies after I retire, right? 

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No! Sorry, emergencies don’t care that you’re retired. Your roof doesn’t keep itself from leaking because the people who live under it aren’t working full-time anymore. So while you hopefully can stop saving for later retirement years (assuming you’ve got enough), you should save for emergencies always. If you end up with a surplus in your savings, beyond your 4-6 months expenses, then just skim the extra off the top every few months or once a year, and do something fun. But treat savings like a bill that you pay for life! It’s one of the few bills that you actually pay to yourself. 

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No matter how much you decide to save or invest for your future, don’t assume that paying yourself first will automatically result in you being in great financial shape. Putting money away doesn’t have the full impact it should have if you’re still overspending and racking up debt at the same time. 

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Learn more about managing your cash flow to help you afford to save and invest. Watch now: Financial Capability Series: Spending and Cash Flow. 

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Are there other areas of your financial capability you’d like to improve? Check out the rest of our on-demand Financial Capability Series topics: 

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About CacheFlo

CacheFlo is a financial education company that builds eLearning and tools to help financial professionals and individuals make behaviour-based changes, which allow them to get more life from their money. We want to make it easier for people to predict the impact of their financial choices before they make them.

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About the Certified Cash Flow Specialist (CCS) program

CCS professionals go through enhanced cash flow-based training to develop the skill set to deliver behaviour-based cash flow advice. They start the financial planning process with a cash flow plan to genuinely help their clients get more life from their money.

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About the Financial Capability Program (FCP)

The FCP combines quick and practical lessons with tools, including Winton, which helps people make financial changes they can stick to. Users can apply what they've learned to their financial situation, thus bridging the knowing-doing gap. The goal of the FCP is to help people get more life from their money.