<I am looking to build up a medium/long term (1-5 year) savings cushion by (bi-weekly) putting 2% of my salary there.>This is a good way to begin building up an emergency fund (called an e-fund by many). Even if you keep it in cash while you are studying your investment possibilities, it's worth starting right away.I suggest that you set up a spreadsheet showing your age, your savings, and how much you will have with different yields by retirement age. With safe investments yielding so little, begin by just adding up the savings (without interest). You can then add columns where you include interest -- but, in the current environment, this adds risk.When I was young, I began to save 20% of my income, not 2%. Unless your salary is very high, you won't be able to save enough to safely retire unless you save a significant proportion. Another way to approach the math is to begin with your goal -- how much you will need to save to live on the often-discussed 4% Safe Withdrawal Rate (SWR) from your savings. Input your number of years until retirement, then see how much per year you will need to save.Wendy
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