Buzz
Personal finance experts, who write books and host seminars, can be invaluable when you're just starting your financial path. But their advice shouldn't be taken as absolute truth.
Often, the guidance they provide is more about being easily digestible rather than being entirely realistic. And if it helps you take the first step, that’s great. But as G.E. Miller of 20SomethingFinance points out, it’s only the beginning:
These days, almost all mainstream personal finance experts recommend a 10%
personal savings rate
(Ramsey goes for 15%), to the point where it has become an accepted norm. Anything beyond 10-15% is considered ‘extreme’, largely because it’s been established as the benchmark. Everyone has something to sell, and since the average savings rate is only 5%, 10% seems accessible and easy to sell to the masses.
That’s perfectly fine, BUT… 10% will never lead to life-changing wealth.
...unless, maybe, you started saving at 22 and never stopped, did everything right, and the market performs exceptionally well over those 40 years.
The point isn’t that a 10% savings rate is necessarily terrible, or that personal finance experts are just money-grubbing book sellers. Instead, view their advice as stepping stones—Miller compares it to training wheels—that, once you've gained financial stability, you can adjust it to suit your own needs (like how much you’ve saved, when you plan to retire, etc.).
It’s a great read filled with insightful discussions, so check out the link below for Miller’s full article.
