Many individuals today often wonder how much do they really need to live. Probably, you opened this article because you’re one of these individuals. Unfortunately, there’s no perfect formula that can answer the question. All there is are contributing factors that can help you determine how much you need to live.
Every factor has its own role in your life especially in the financial aspect. Thus, knowing more about it will help us determine the answer to this agonizing question.
Your current expenses
First factor would be your current expenses. Analyzing it will let you gage on the exact amount you need to live. List down your current financial responsibilities; such as grocery, mortgage, monthly bills and education of your kids.
If you’re paying for certain insurances, better list it down, as well. Scrutinize which of these items can be scratched off and which can be lessened. This way, you can get a broad idea of how much you’ll be paying monthly and technically how much you’ll need to live.
The way you live plays a significant role in knowing how much you’ll need to survive. If you’re a party goer, then most probably you’ll need lots of cash. If you love to travel, then you need to fill that savings account. On the contrary, if you’re a simple person who loves healthy food and shops seldom, answering the main question can be easy.
What are your main needs
As of your standing today, what else do you think you’ll need in the future? Do you need a college education? Or perhaps a capital to start your own business? Are you willing to work? Knowing the answers to such question will help you gage the amount you’ll need to survive.
If you’re good at saving up, then everything will be easy. However, if you’re an over-spender, then saving the cash for the following years may be a challenge.
List of debts
Are you currently dealing with a long list of debts? How long do you think will it take before this list will vanish? If you have a long list of debt today, then knowing the exact amount you’ll need for the next years will be difficult. With that being said, it’s advisable to erase these debts first.
Sure sources of cash
After knowing the main expenses, the last thing you should know, is the surest sources of cash. Aside from your current job, what else can you consider as a sure source of cash? Make your life plans, insurance premiums and certain funds than can guarantee you a certain amount? Can you survive with the money you’ll get from such sources? Knowing it will help you gage the amount you need to live.
As what is mentioned in the introduction, there is no perfect formula for us to compute how much we need to live. That is why every reader should keep a close eye on the factors to consider that were mentioned in this article. Through it, you’ll be able to make your own bracket and estimate the cash you’ll need.