Quote:
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Originally Posted by Fillanzea
The situation:
The question: how should I save my money? Should I try to save about $200/month for eventually buying a car, house, appliances, furniture, that kind of thing? Or should I be diverting more of that money into my 401k?
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1. I would start of my getting on a budget. So that way you know where your money is going and how much you have left over to save. You might find out that you have more than the $200 per month to save.
2. I would then pay off all debt you have, starting with the smallest amount to largest amount.
3. Then I would open an online savings account (HSBC is at 5.05% APY right now), and put any extra money you have in that, so you can save for a car (which should be paid 100%) or house (which you should have 20% down) or what ever you like. Plus a emergency fund - 3-6 months in savings
4. Then when you get a full time job I would open a Roth IRA and do more in the 401k.
If you have heard of Dave Ramsey or not I would check out is website at
www.daveramsey.com or read his book The Total Money Makeover, which will get you going on the right track in life.
I was in the same boat as you are a few years ago. I was working part time and wanted to save for a house and a car. Well by following Dave Ramsey's plan I have paid off all my debt (Student Loan & Car Loan) in 2 years and now have $500-$800 per month to save for a down payment on a house.