Inspired Question - What percent should an adult save?

lisasayzhi · #1 (**permalink**) 07-20-2005, 04:35 AM

Someone else's question about how much of their weekly paycheck their 15 year old grandson should save. This made me begin to wonder how much I should be saving. Currently I make roughly $275/week. I'm a 20 year old college student with 2.5 years left to go in school. I share an apartment with my fiance, so all bills (rent and utilities and groceries) are split in half. I have no car payment. I've been saving $10 a week... but I realize that's close to maybe 3.5%... What percentage should I be saving of my paycheck?

BAGAGT1 · #2 (**permalink**) 07-20-2005, 06:04 AM

So you are saving $520 a year, which is pretty good for a 20 yo college student. The question you should ask yourself, is what do you want to save for, a house, a car, retirement, vacation? Based upon your answer, you will have to modify your savings plan accordingly.

You didn't say whether you are paying for college yourself (even if partially), so it is difficult to guage how much I think you should save. At the very least, you should try to save $1K (everybody could use an emergency fund), which would only require you to up your savings to $20 a week.

jmjj215 · #3 (**permalink**) 07-20-2005, 06:33 AM

I agree with Bagagt1 - set some goals with what you want to achieve. Depending on how hard you want them, you'll adjust your savings accordingly

lisasayzhi · #4 (**permalink**) 07-20-2005, 05:25 PM

Ideally I'd like to pay off my student loans but have enough savings to help me out right after I graduate (in about 2.5 years) if it takes me time to find a good paying job in NYC. I've got around $950 in savings right now earning 3% interest. Only 1 of my student loans is accruing interest, and it's about $2,500 and a 5.7% interest rate. Total, I have about $8,000 in student loans.

jmjj215 · #5 (**permalink**) 07-20-2005, 06:34 PM

Lisa, I agree with you. I'd get a small e-fund like you have, of about 1k, then I'd start throwing money at the student loan that is accruing interest. For your fund to help you out right after you graduate, you need to just decide what amount will let you feel comfortable - until that perfect position opens up for you!

terry1156 · #6 (**permalink**) 07-20-2005, 06:39 PM

It sounds like you are in a better position than most people your age. If you come out of school with only student loans and no credit card debt, you're way ahead in the game.

The above advice is good. I don't know if you have any opportunities (or time) to earn a bit more, but that is also a possibility - but don't worry too much about that now. You'll have plenty of time to work once you've graduated.