
How much should I think of saving every month as a 29 year old? - yoran
https://enzo.fund/how-much-should-i-think-of-saving-as-a-29-year-old-every-month
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ram_rar
Please dont ruin your present to become financially independent. I know people
who cut their own hairs and do a whole lot of stuff to micro optimize their
savings. That kind of lifestyle is just not worth it.

As long as you're being mindful of being cash flow +ve and save some $ for
rainy day, you're good.

I Started with

1\. Emergency fund (6months+ expenses or whatever you're comfortable with),
2\. 401(k) / IRA (if you're employer provides it), 3\. indexing (simple plain
old vanguard low fee fund).

thats about it, nothing more.

I am a chase private client, own a house and could probably retire within next
3 yrs or sooner if I really wanted to... I dint think of FI all the time, it
just happened.

~~~
jay_kyburz
>cut their own hair

Actually many of us think is worth it. Take the price of that haircut, pay 10%
compound interest on it for 60 years, then ask yourself if you really care
what your hair looks like.

I used to spend money on these things when I was younger, but with a few
decades of adulthood under my belt, I care less about nice haircuts and fancy
cloths.

Now, time is more valuable that anything else in life, and financial
independence buys me that time.

The notion that we should all sell ourselves as wage slaves so that we can
afford a new iPhone every year is bonkers.

Reject it all. Live Free.

~~~
hindsightRegret
You can have a job and still be free. The two are not mutually exclusive. OP's
point is that you shouldn't slave away the prime years of your life saving for
the dream of FIRE on some beach, island, or etc.

I think the idea that you'll be so much happier once you're on that beach than
you are now is equally as insane as conspicuous consumption.

~~~
twiceaday
Having a job is not relevant. It's about _requiring_ a salary. If every single
person _had_ to work but you removed the financial incentive almost nobody
would do their exact current duties or work their exact current hours. They
would switch things to be happier. The more of a financial incentive there is
the harder it is to make that switch. And the entire point is that you can
lessen the financial incentive by lowering your ongoing costs and you can
completely eliminate it sooner by saving and investing. Imagining a straw-man
that slaves away and saves too much is not helpful to anybody except as a
'gotcha, your rule-of-thumb life advice is wrong in one case' pedantry. It
seems ridiculous in a context where seemingly nobody saves money or plans for
retirement. Nobody over-saves. This is made-up smug-bait peddled to those who
are far from saving too much and want to feel good about it. "Can you believe
this guy cuts his own hair? Scoff!"

Your last sentence is also a straw-man. You are attempting to debunk what
constitutes a click-bait headline. Nobody will defend that ridiculous,
oversimplified, universally-extended argument. What is even your point? The
full statement requires so many variables to fully qualify, what truth are you
attempting to convey?

~~~
hellisothers
I think hindsight’s and the OP’s point is to not over index one way or the
other. You can optimize for happiness now and very likely suffer later or
optimize for probably happiness later and suffer now or pick somewhere in
between. I agree that a lot of the discussion from the FIRE cohort sounds like
you should suffer now for rewards later with an almost religious zeal.

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rayraegah
;not advise

Don't focus on a number but focus on giving yourself some room to breathe.
Slowly build a habit of saving money by snowballing money into a savings
account to start. Don't measure your worth by money.

I didn't consider saving until I bought the engagement ring (which left me at
a bank balance close to 0 and it wasn't the first time). I was 27 years old.

I started setting aside some money as a cash reserve (bucket #1) and I made
sure there was enough money to:

    
    
        - get me through two months on rent (3,000 GBP)
        - feed myself for two months (400 GBP)
        - buy one flight ticket home (to parents basement)(700 GBP)
    

Once bucket #1 was full, I started tossing money into bucket #2 which was
disposable income stashed in a decent interest paying savings account. This
was for rainy days and the future.

By the time I was 29, I had about 10,000 GBP in savings between the two
buckets. A good portion of it was spent on our wedding and honeymoon (from
#2). By 30 I had 15,000 GBP in savings. Most of that was spent when I moved to
Tokyo (damn moving costs). I had $1,000 USD left; it was a fresh start.

I'm 32 now and I have about one year worth of living expenses in savings and
then some. I make monthly contributions towards a pension, life-insurance, and
a retirement fund (bonds).

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JaggedNZ
Something I have not seen mentioned yet, it might be obvious?

Pay off your debt first! It has a guaranteed return on "investment".

The following scheme has worked well for me.

First take any employer matched retirement scheme (401(k) / IRA, etc.) and
keep some money to build up a rainy day fund if you don't have one (a few
weeks income is a good starting point) as theres no point defaulting on a loan
because you made extra payments the week or month before.

But there is no point saving or investing money that could be going towards
paying down a 22% credit card debt or 16% car loan, or even a 5% House loan.
The only exceptions would be low interest loans (i.e. <1-2%) with a fixed
payoff date.

On Mortgages, there are many schemes but I'd advise, 40% 1 year fixed, 40% 2
year fixed, 20% revolving credit, dump any rainy day funds, and any other
spare funds, on the revolving loan == interest you don't pay. Keep the fixed
term loans expiring every other year so any interest rate spikes only hit half
your capital.

Disclaimer: I am not a financial adviser and this is not intended as
"investment" or "financial advice".

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chubs
I am not a financial advisor, but... start with 10%. Use high-interest savings
accounts if you need to dip into the money unpredictably. Use term deposits if
you'll need to access the money in a year (shares might dip in that time). Use
index funds if you won't need the money for a decade (index funds aren't very
risky at that time horizon). And start putting away money for your kids the
moment they're born, find something that tax-effectively allows you to
transfer the money into their name when they turn 20ish without some form of
capital gains on their behalf. Consider spreading it around to some different
accounts so that if one investment goes under you don't lose the lot.

~~~
bloaf
[https://www.mrmoneymustache.com/2012/01/13/the-shockingly-
si...](https://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-
behind-early-retirement/)

Savings rate is basically the _only_ number that matters in determining how
long until you can comfortably retire. A 10% savings rate puts you on track to
retire in ~50 years, starting from zero and given some conservative
assumptions.

~~~
chubs
Wow, 10% really doesn't get you very far, does it! Well, maybe people should
aim higher. In my case, i'm less worried about retiring early, and more
interested in saving so my kids can more easily buy their first house.

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droithomme
At least 10% annually and give another 10% at least to charity.

I liked to put some in stocks I already had decided on, but also a bit in
cash, then when there was a panic and prices dropped, I grabbed a bunch of
things I already had and knew were solid. Not a gambler, just an observer that
likes a bargain and is patient.

~~~
vips7L
10% to charity? I don't think that is realistic at all.

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droithomme
That's great! It really should be more as you point out, I typically give
around 30% each year. But I know that is a bit higher than most. 10%'s kind of
traditional "tithing" which is why I mentioned that, but that should be the
lowest probably. Of course people can also choose not to give back at all. One
of the great things about being in the tech field and making an enormous
salary is it gives us the _power_ to influence the direction of society
through targeted donations. One charity I've supported for years keeps trying
to have a "gala" in my honor. I tell them forget it, and for goodness sake
keep me anonymous. Sheesh. Trouble like a gala I don't need.

~~~
geowwy
This sounds a lot like a humble-brag :)

~~~
grandmczeb
> One charity I've supported for years keeps trying to have a "gala" in my
> honor. I tell them forget it, and for goodness sake keep me anonymous.

More than sounds like IMO...

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temp99990
I never thought it made sense that people should expect to do nothing for 30+
years of their life.

For most the anxiety of boxing yourself into that belief that after a certain
day of your life that you can’t earn another dime makes no sense. If you look
at the current stats there’s a huge % of people nearing “retirement age” who
have nothing saved.

Personally I have had a surprising number of Uber drivers who are retired and
bored and drive to socialize with others. Although they may be lucky to have
saved enough I don’t necessarily think it would be “depressing” for someone
who was otherwise of retired age to take on a job that they felt they were
capable of doing instead of sitting at home doing nothing all day

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RickJWagner
Very glad to see this article, packed with good advice.

Financial education is so important, yet so seldom presented. It literally can
make a HUGE difference in quality of life. Everyone should at least understand
the basic blueprint of how to care for your own financial future.

For those who haven't seen it yet, a great next step is to visit
Bogleheads.org. A great community of knowledgeable savers, including many who
never earned a great salary but still have managed to assure their own future.
If you haven't seen it, check it out!

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dannykwells
I am the same age - we save/invest around 30-40% of our post-tax income.

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ojhughes
The big problem I have with saving lots is expensive hobbies! My current
dilemma is whether or not to embark on a campervan conversion project.

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wsdfsayy
$800k for retirement seems very low...

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52-6F-62
You must come from a very different world than some of us.

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jknoepfler
That also seems low to me. in the u.s. you can't count on social security,
you're going to be paying for health insurance, and the government safety net
in general in non-existant.

I'm personally targeting $2 million to retire comfortably by 50, and I think
that's only slightly pessimistic.

For context, I'm 35 and in good health, but I plan on having to pay several
thousand a month in health care and housing, and need to be able to endure
market swongs.

Retiring now is certainly possible but strikes me as foolish.

~~~
52-6F-62
Funny enough I meant in the other direction— where I come from you’d be
considered rich if you were retiring on $800k CAD, never mind USD.

I can assure you my father retired on much less and largely relies on national
and union pensions.

Not to say it’s good to retire on less. He’d happily have more money put away
but that wasn’t how life happened. It’s not how life happens for a lot of
people.

Hence the “different world” remark.

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lurquer
You only have, at most, 12 months to worry about... I don't think it will make
much a difference.

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distantaidenn
What's supposed to happen in 12 months?

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Cofike
Turn 30, I presume.

