Savings and working.

Savings and working.

Hey Everyone,
I am having a hard time saving with the yolo lifestyle.
I am very young only 23 and have a 85k salary.
But i spend alot of money on rent and holidays and food and expensive stuff.
I only save 20 percent of my pay.

What i want to know is since i am young is it good to live like this or is it better to save,

please give opinion

also how much of your weekly salary do yall save

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Comments

10Linefigure

You are only this young once. That said, you're saving 20% of your salary and thats pretty good. Seems like you are off to a good start.

Matt2

Where is that 20% going, just to a savings account, or to retirement fund(s) etc. Saving 20% is good overall, but where is important. You're ahead of MANY people doing that.

Compound interest/growth is your friend, so save the most you can the quicker you can. And eventually you will be far enough ahead you might even be able to start saving less. Anyways, I like Dave Ramseys methods, I don't strictly follow them, but it's good methodology. Real Debt Help - Get out of debt with Dave Ramsey's Total Money Makeover Plan - daveramsey.com

Edit: ok that's annoying... the URL goes specifically to his 7 steps, but the title in the URL says something different. Pasting on those steps too.

Baby Step 1 - $1,000 to start an Emergency Fund
Baby Step 2 - Pay off all debt using the Debt Snowball
Baby Step 3 - 3 to 6 months of expenses in savings
Baby Step 4 -Invest 15% of household income into Roth IRAs and pre-tax retirement
Baby Step 5 -College funding for children
Baby Step 6 - Pay off home early
Baby Step 7 - Build wealth and give!

N2IT

20% is pretty good.

Heero

20% savings rate is good. You will be fine in retirement with that. You could also save more and be able to retire sooner, or with more money. But you are at least saving enough to be ahead of 90% of the workforce.

Cyberscum

When I was 23 I was only making about 70k. I partied like it was 1999...Have never looked back, had a grand ol time.

You are one step ahead of were I was at 20%. GJ and enjoy your life...YOLO

NetworkNewb

Sound like you got a pay jump in your new gig. Said you were making 59K at your last job (going off post from yesterday). nice little bump there! gratz on that btw.

Your saving more then enough right now too, my wife is a HR manager and bugs me all the time about savings and health plans and what not

markulous

23 years old and you make 85k and save 20% of your pay...You're doing awesome. I wasn't even making half that amount at that age although I probably saved close to that.

TheFORCE

NetworkNewb wrote: »

Sound like you got a pay jump in your new gig. Said you were making 59K at your last job (going off post from yesterday). nice little bump there! gratz on that btw.

Your saving more then enough right now too, my wife is a HR manager and bugs me all the time about savings and health plans and what not

Smells like a ***** to me, from yesterday to today.

Cyberscum

It could happen? I think...

nster

maybe he was in salary negotiations, hence his post yesterday...

Priston

Last year my net income was ~$30,000.
~$8,500 was spent on rent
~$14,000 was spent on all my other expenses
~$1,000 was put into my roth IRA
~$6,000 was left in my saving account.

I have a personal goal at the beginning of the month to always have more money in my bank account then the beginning of the previous month. The last time I wasn't able to do this was 3 years ago when I paid off my car.

If I was making $85,000 a year, I'd put the maximum into my roth IRA while I'm still young / don't have kids. If my employer had a company match 401k I'd put the maximum that they'd match.

Since your 23 now, if you put $30,000 over the next 6 years into a roth IRA and nothing after that, with a interest rate between 10% and 12% you could potentially retire with 1-3 million in your IRA. Of course you don't want to put all your eggs in 1 basket. So having a 401k on top of them would be good too.

katiesss

I actually got the offer
its 85k so when you break it down its 75k base salary and the extra 10k is for over time - on call and bonuses so 85k.
I am going to be moving back with parents so i can save more and free rent.

salary does not matter its all about the location, location is everything, I know so many people that make 100k plus straight oout of college or with a couple of years of experinece thats because they are in areas that has high expenses like NYC etc or Seattle or Siclicon valley.
In my area the average salary is like 45k so me getting 85k is alright.