Originally Posted by Shahab6
How much should I be saving? I'm 23 years old I make $2300 a month. I live at home. At of that money, how much should I be saving every month?
What is a good percentage to be saving.
It depends on what your goals and timetables are, but i will put my 2cents in on this
First and foremost you gotta LAY THE FOUNDATION
. You say you make $2300/mo, does your job(s) offer a 401k? If they do then get in it IMMEDIATELY! Set the contribute amount high (10%-20%) and have it auto deducted from your check so you cant control it coming out. Also setup a Roth IRA
at your bank. The current maximum no-penalty contributions to a Roth are $4,000/yr so make sure you are putting in $334/mo or as close to that as you possibly can.
Setup multiple accounts at your bank, here is a good template:
2 Checking accounts
broken down as:
-1 Public - Use for online transactions
-1 Private - Use this for personal transactions
3 Savings/Money Market accounts
broken down as:
- 1 Regular account - put atleast 20% of your "after taxes" income here, when you pull money out (to make a purchase or invest) try to cap your withdrawl at %5 of the total balance of this account.
- 1 Emergency account - this should have a minimum 3 months worth of expenses (rent, food, car, insurance, etc)
- 1 Fruits of labor account - ANY
profit from any investment that you make YOU MUST PUT %20 HERE
. Just made $30 profit on an HYIP payout? Put $6 here. Just make $1000 profit on a stock sale? Put $200 here, you get the idea. You should spend the money in this account as you see fit. Donate to charities, buy new shoes, vacation, etc.
Grow your investments, and always harvest them. ALWAYS
take your cut of the profit out of your investments ALWAYS
. No reason to bake a loaf of bread and let it go to mold, no reason to grow a field of wheat then never harvest it, etc.
Many of the terms used in this post apply to the USA only, however the premise is much the same throughout the free world. You should be able to find similar alternatives that perform the same function in your home country.
take your cut first before anybody else gets paid, after all it is YOUR