Question

25. Malcolm is working full-time and wants to make sure he's saving strategically for four specific goals: an emergency fund ($5000), a flight home to see his parents for the holidays ($450), a downpayment on a new car ($3000), and his retirement (2% of his monthly take-home pay). What's his best strategy?

Answer 1

A good strategy for saving or paying of debt is called the snow ball effect.

First, he would definitely need to save for his retirement before anything else.

Then you start tackling the smallest goal first. Once that one is paid off, you take that amount and apply it to the next goal and one from there.