How much money should a 30 year old save?

Twenty-something years old is a time where you’ll begin to see the future coming into view and know just how much things might cost. From a house, to marriage, to kids and more. The future is going to be expensive - which means that now is the time to start saving for it.

That said, here are some things you should keep in mind when figuring out how much money you should save by the time you turn 30. That way, your future self will thank you for being so thoughtful now.

Topic Index
  1. Determining how much money you should save by 30
  2. Your current annual income
  3. How many years you’ll have until your next milestone
  4. What things cost, on average
    1. Tips for saving more now and in the future

Determining how much money you should save by 30

There’s no set amount of savings that everyone should have, since everyone has different goals, incomes and expenses. Still, if you want to be financially secure, there are some things you should have saved by age 30.

  •  One month’s rent and utilities. Ideally, you should be saving enough money to cover your rent for at least one month, since life (and landlords) happen. Depending on where you live, these expenses can be a big chunk of your paycheck, and being able to cover it in case of an emergency is ideal.
  •  Six months’ worth of expenses. This is the bare minimum amount of savings you should have in case you lose your job or get hit with a major medical bill. Ideally, you should aim to have 12-18 months’ worth of expenses saved, in case of an extended unemployment. In case of an emergency, this money can give you breathing room until you can get back on your feet with a new job.
  • An amount equal to 10-15% of your gross annual income. This is the general rule of thumb for how much you should be saving, regardless of age. This is the ideal amount you should have in your retirement accounts, like IRAs and 401(k)s, in addition to any other savings you have.

Your current annual income

The more money you make, the more you’ll have to save. It’s that simple. Stepping up your savings game will take some effort, and it’s probably going to take a little bit of time as well. The more you make, the more you’ll have to save in order to reach the same goals as someone who earns less. The good news is that the more you earn now, the more you can make sure you’re financially secure in the future.

That said, you should try to increase your savings rate as much as you can without completely disrupting your life. This can mean working a side hustle to bring in extra money, or cutting back on expenses where you can. Saving more now will pay off in the long run, especially if it allows you to reach your goals sooner.

How many years you’ll have until your next milestone

You can use how many years you have until your next major milestone to determine how much you’ll realistically be able to save.
One example: If you want to be able to save enough to buy a house by the time you turn 30, the standard rule of thumb is to have enough saved for a 20% down payment. This means you’ll need to save about $53,000 for a $200,000 house. If you have 10 years until you hope to buy a home, you’ll have a few milestones in between, like paying off your student loans, saving for a wedding, potentially having kids and other expenses that could arise.

These milestones will affect how much you can realistically save. If you want to save for a down payment on a house, but also have several other costly things you want to save for, you’ll need to prioritize.

What things cost, on average

If you want to save a certain amount of money before a certain age, knowing how much things cost will help you determine how much you’ll need to save to reach that goal.
Vacations, weddings, car payments, student loan payments, kids' college tuition, retirement savings - these are just some of the expenses you’ll face before 30. You can take a general look at how much these things cost in order to get a better idea of how much money you should be saving.

  •  The cost of a house. The median price for a house in the U.S. is about $230,000. If you have 10 years until you plan to buy a house, you’ll need to save about $5,300 per year to have a 20% down payment saved by the time you’re 30.
  •  The cost of a wedding. The average cost of a wedding in the U.S. is around $30,000. If you want to save for a wedding and a down payment on a house at the same time, you’ll either need to double your savings or delay your wedding.

The short answer is that it depends. Everything we’ve discussed so far will help you get closer to determining how much you need to save, but there are no hard and fast rules. The best you can do is estimate based on your current income, upcoming expenses and how much you can reasonably cut back on your spending each month.

One way to do this is to create a savings plan for yourself. First, estimate how much money you need to save each month in order to hit your goal. Then, break those figures down into smaller monthly chunks, and prioritize which goals each chunk should go towards.

Tips for saving more now and in the future

  •  Make saving a priority. The easiest way to make sure you’re saving enough money is to prioritize it above all of your other expenses. Put money into your savings account as soon as you get paid, and don’t touch it unless it’s an emergency.
  •  Automate your savings. If you’re struggling to find the extra money to put away in savings each month, try automating your savings. You can set up a savings account that automatically withdraws a certain amount from each paycheck and transfers it straight to your savings account. This can make saving effortless, and help keep you from spending the money you’ve set aside for savings.
  •  Start small. If you’re just getting started with saving money, don’t feel like you have to start off with a huge monthly contribution. Just like with a diet, you should start small and build up from there. Start with something small like $50 per month, and increase from there as you get more comfortable.

The sooner you start saving for your future, the better off you’ll be. Sinking as little as $50 every month into a savings account can make a huge difference down the line. That money can compound and grow significantly over the years, and it can be a real life changer when it comes time to buy a house, go back to school or retire.

That said, don’t wait until you’re 30 to start saving. The sooner you start saving, the more time those savings have to grow. It’ll be worth it in the long run, and it’s never too soon to start saving for the future.

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