Let’s take a look, at how much should you invest, if you don’t want to decide on your own then you can follow some of the rules that are given by experienced people- some of these rules are- the 50/30/20 rule which suggests that one should invest 20% of their income, while the book richest man in Babylon suggests that one should invest at least 10% of your income. If you are not able to understand how much to invest, then you should follow any of these rules, and you would be just fine. But under this type, you won’t get a specific amount, but a percentage to invest.

In case you wish to understand, how much should you invest based on your goals here is how you can calculate it:

1. First of all make a list of goals you would like to achieve, you can categorize them under 3 different categories- long-term goals, medium-term, and short-term goals. For example let us take one in each kind of retirement fund under a long-term goal, let us aim at 60 lakhs retirement fund, which you would need after 30 years. For a medium term we would take a goal like buying a car, worth 10 lakhs after 5 years, and a short term goal like a vacation after 1 year which would cost you 70000. So let’s figure out how much would you have to save per month to achieve all of these goals at a given time. But with these goals, we would have to consider inflation also, so let’s take after 30 years the price of everything has increased by 50% so you would need to save 90 lakhs but let us consider 1 crore. And in 5 years the price of everything is up by 10% so you would need 11 lakh for your car. And let’s not consider inflation for a 1-year plan.

2. So now before you figure out how much to invest, you would need to calculate total income, considering you get 1 lakh in hand after taxes, also now you would need to subtract needs, imagine you have total needs worth 50,000. But make sure that you include insurance under needs. So now we are left with 50,000 to invest and spend on wants.

3. So now, to calculate how much to save based on your needs, you would need to invest 4000 for retirement planning, 14000 for your car, and 6000 for your trip. So you would invest approx. 24000 and let us consider you investing another 6000 in mutual funds. Then your total investment lands at 30,000 which is 30% of your income.

4. Now you must have understood how you can calculate based upon your goals, and by this, you would achieve all your goals and even invest some extra. Also, the rest 20,000 are for you to spend on your wants.

**Conclusion –**So I have concluded both the ways you can decide how much you should invest, if you know your goals and want to save for them then you invest accordingly or you have the option to use a percentage method given in any book or budgeting rule. But make sure you invest at least 10% of your income.