According to Jayant R. Pai, Head–Marketing, PPFAS Mutual Fund there is no one size fits all when it comes to the amount that you need to save. The percentage of salary that you should save each month depends on your circumstances. Here’s a thumb-rule:

■An individual who is not indebted and who begins his career at 23, should save 60-65 per cent of the take-home salary in the first seven years of his career

■25-30 per cent in the next 20 years

(here, rising salary will be offset by increased expenses; so the ratio falls)

■35-40 per cent in the final ten years of working life (Assuming the retirement age is 60).

This includes all tax-related savings. The asset allocation will vary based on age and personal circumstances, and these ratios will go down if EMIs are factored in.

olmdesk@outlookndia.com