Introduction
People always have a mental image of what they expect their future life to look like. Ideally, a major number of people set minimum standards to provide better conditions than they are in their families for surviving, but they usually have a desire to have a higher life quality. In my case, I look forward to being a Financial Systems Analyst in New Jersey. At forty years, I expect to have completed a master’s degree with more than ten years of experience to receive an average monthly salary of about $8000. My home will be located in Atlantic County, New Jersey, where I anticipate living with my spouse and two children. In the social sphere, I would like to be developed from different sides – attending public events, concerts, a gym, having a membership in some club. Therefore, this paper estimates the desired lifestyle’s budget and how to create a sustainable retirement plan.
Itemized Budget
According to the Economic Policy Institute’s (EPI) budget calculator, the monthly cost of living for a family with two kids in Atlantic county is $7763. Hence, the estimated value of the itemized budget is relatable to some families.
- (Monthly spending x 12) X 25 (appropriate years spent in retirement) = The amount needed for retirement
- Amount needed for retirement = (7590 x 12) = 91080 X 25 = $2.277 million
- Withdraw 4% annual inflation = 4/100 x $2.277 M = $91080
- Sustainable amount for retirement = $2.277 million + $91080 = $2.368 million
Ways to start saving
The total amount required to sustain the family after retirement is relatively high. In essence, the savings from the anticipated salary cannot provide the estimated sum. Hence, to achieve the goal of a comfortable life in Atlantic county, an efficient saving plan has to be adopted. First, monitoring my current expenditure can be valuable. Ensuring that money is spent out of necessity can help reduce impulse buying (Allom et al., 2018). For instance, purchasing clothes because of weather change instead of the trending fashions reduce unnecessary outlay. While maintaining the same level of income, reducing expenses leaves a considerable amount for savings.
Secondly, pre-planning will ensure that one makes purchases in bulk, attracting discounts. Most goods and services are paid for after one receives some revenue. Preparing a shopping list with the commodities to be consumed throughout the month can increase surplus finances (Allom et al., 2018). Since student’s income is scheduled from parents and loan prepping as possible. Arguably, Amazon shopping can be instrumental as they provide offers for purchases made beyond a specific cash limit reducing costs. Hence, a change in the method of buying goods will increase savings.
In addition, finding a part-time job can improve my current financial status. Employment will be an additional source of finance. It can help develop a behavior of saving either directly or indirectly. The money earned can be deposited into a savings account as most of the essential needs are catered to by the student loan and parents. Alternatively, the money funds can be used to cover some of the expenses in college. As a result, I can terminate receiving government funds to reduce the future outlay on debt servicing. A surplus then arises in the itemized budget, which can be added to the savings. In conclusion, life goals are easily achievable in theory but creating an itemized budget clarifies that significant effort is necessary for a good lifestyle.
References
Allom, V., Mullan, B. A., Monds, L., Orbell, S., Hamilton, K., Rebar, A. L., & Hagger, M. S. (2018). Reflective and impulsive processes underlying saving behavior and the additional roles of self-control and habit. Journal of Neuroscience, Psychology, and Economics, 11(3), 135. Web.
Economic Policy Institute. Family budget calculator. Web.