Hi Money Minder,
Hey there! So, I was crunching numbers for my budget and figured out that I’m supposed to save 20% of it. But I had a few unexpected family bills come up, so I really want to make sure I’m making the most of this money.
Do you have any suggestions on where I should put this 20% of my savings? I currently have a Roth IRA with Fidelity and a High-Yield Savings Account (4.25% APY) that seem to be doing well. How much do you think I should be adding to my HYSA monthly? My job doesn’t offer a 401k, is it possible for me to ask my employer for one? Should I try to maximize my Roth IRA contributions to the yearly limit? I’ve already factored in my student loans with the 50% chunk, but do you think adding more towards them would be helpful?
I’m a bit hesitant to share exact numbers right now, but if it’s really necessary, I can always edit my post later. I’m just really curious about how I can make the most out of my savings. Appreciate any advice you can give!
Take care,
Savvy Saver
Response from THE MONEY MINDER:
Hello There,
It sounds like you’re being very thoughtful and proactive about managing your finances, and that’s commendable. Given your current situation, it would be wise to prioritize building up your emergency savings first. Since you already have a High Yield Savings Account (HYSA) with a competitive APY, it’s a good place to continue growing your savings. Determine how much you can comfortably afford to contribute to your HYSA each month and stick to that plan.
Regarding your Roth IRA with Fidelity, contributing to it up to the annual limit is a great way to invest in your future. Given that you don’t have a 401k through your job, maximizing contributions to your Roth IRA is even more crucial for your retirement savings.
When it comes to student loans, if you’ve already factored them into your budget, it’s generally beneficial to focus on building your emergency savings and investing for the future before aggressively paying off low-interest student loans. However, it might be worth considering making extra payments if it gives you peace of mind and helps you feel more financially secure.
As for asking your employer about a 401k, it can’t hurt to inquire about any potential retirement benefits they may offer or see if they have any other saving options available. In the meantime, continue to focus on your savings goals and finding the right balance between investing for the future while also taking care of your immediate needs.
Take the time to review and adjust your budget regularly to ensure it aligns with your financial goals and priorities. Remember, it’s all about finding a balance that works for you and your current financial situation. Stay diligent, stay informed, and keep making progress towards your savings goals.
Take care and best of luck on your financial journey.
Farewell from THE MONEY MINDER.
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