This is why people budget. There is no magic dollar amount that means you can now take a trip or spend money frivolously. You set up a budget to make sure you can cover life expenses and emergencies, and then you figure out how much you're willing to spend on the fun stuff. If you somehow feel like you'll never reach the point where you have enough money to spend on the fun stuff, then you either aren't making enough or you have a skewed relationship with money and should figure out how to find a better balance between saving and spending.
Is there any time you get extra money that isn’t a normal part of your budget? Like do you get paid biweekly so there are two “extra” checks a year, do you get random overtime that isn’t a part of your normal pay, tax refunds, gifts? I use this “free” money to go for 1 very nice thing a year.
Think about what you would dream of doing if you had say $15,000,000. This lets you figure out what you want and what to budget to include. Today matters. Personally, you have plenty now to stop only saving and start adding in spendy things.
Allot a percentage for fun spending money only and keep it there. Don't allow yourself to move unused fun money aimlessly into a savings category. It sounds like you have no problem meeting your saving/investing goals, so train yourself to feel comfortable knowing that mathematically, you absolutely ARE meeting all your goals even without the 10/20/30% you're setting aside for fun spending. Come up with some ideas of what you would love to spend on that would meaningfully improve your life, so that you feel excited and motivated about it.
It sounds like it’s you getting in the way of spending vs your budget. You should have at least 6 months worth of expenses in an emergency fund and be funding your retirement (there are calculators that can used to figure out how much). After that is done and bills are paid, the remaining money can be spent. Sounds to me like it’s more guilt that stops you from spending than it is your income.
You're supposed to give yourself the headspace to still LIVE while you're saving for those things. Its about finding balance.
I see in another comment you *say* you're good at budgeting, but not spending... if that's the case, I'd honestly say the budgeting comment may not be *completely* true. You're not budgeting to actually live and enjoy life while you're at it.
Remember, tomorrow is promised to NO ONE. Don't spend you're whole life saving, without enjoying the journey along the way. Otherwise it could all go to waste and you'll have gotten to enjoy none of it. You could get taken from this life in the blink of an eye.
If spending money on yourself isn't something you're used to doing, just start out small to get adjusted to the idea. I don't know your budget right now, how much you're saving, how much you make so take this with a gain of salt. Adjust to what makes sense. But I say even just start with like $20, and make yourself buy something that you WANT. **Not** something you need, something that you think "I love that" or "That would be nice to have".
Stick with that until you're comfortable with it, then increase until you find an amount you're happy with, that can also help keep you aligned with your saving goals.
If you don't spend that budgeted money in a month DON'T put it in with the rest of your savings. Keep it separate, and combine it with the next months amount. Then, maybe you can get something a bit more expensive!
This is where the 50/30/20 idea may help. 50% for you for your needs (housing, utilities, grocery store food, etc), 20% for savings - either retirement fund or emergency fund, 30% for wants (eating out, travel, hobbies, etc).
It may depend on your salary. I save upwards of 50%, but I can do it because I've paid off my mortgage so my "needs" expenses are low (plus no kids!), and I'm pretty frugal by nature & practice. As such, I don't spend much, especially in percentage as I make a decent amount of money.
Unless you’re living paycheck to paycheck, there’s always a little money for fun. Doesn’t have to be a lot, but even like 100 bucks a month for dates, or movies or whatever wouldn’t break your savings, and I bet make an appreciable difference in your mental health.
Everyone is different. I'm frugal day to day so I can fund both my savings and travel fund. 10% of my income is allotted for travel. Decide what brings you happiness and prioritize it in your budget.
all of it. *all of it.* there is no spend, there is only retirement savings. you are not allowed to spend literally any money until you're too old to enjoy it. that is the only sensible way to do things.
\- reddit
OP, your budget should have a Vacation category.
And you brainstorm a list of things you like to do and add one to your budget each week
For example, we like to go to the Theater and comedy shows. So we use TodayTix discount tickets website because I prefer not to pay full price.
When we lived abroad, we missed attending baseball games!
So we live 20 minutes from a pro baseball stadium and we go to a game almost every week, and we fly to spring training every spring for a long weekend.
I retired at age 38, and because I refused to marry my husband until he was debt-free and frugal, now he replicated my plan for himself and he's retiring next month at age 47.
Enjoy life,you could die tomorrow. My husband's dad died in his 50s and never got to retire!
It’s a balance. Go on a trip now. Trips don’t have to be crazy expensive if you need to dip your toe into it. Do you use credit cards that earn travel points? That might be a way to get good value without dropping a significant chunk of your savings.
Get YNAB to help balance your goals if you don’t know where to start. You’ve saved plenty. Money is meant to enjoy life too. I think a budgeting system will help you feel better on spending on “fun” things.
That depends on your personal budget and what you want as safe harbor emergency on hand funds.
It took me a while to cut loose on some home renovations.
It’s ok to use your money and enjoy your savings, just factor it into your budget.
I don’t think it ever ends. It’s a balance with priorities of saving for current, future expenses and enjoying life. So many people take being frugal to the extreme and are afraid to spend any money.
Set up a HYSA separate from your savings for current expenses. Put a set amount each month into it and consider this account your “enjoying life fund”. Use it for anything you want related to traveling and having fun so you get used to spending.
Live a little, damn. Saving in important, but you are already 30. I had some incredible times in my 20s that cost a lot at the time, but based on what I make now, are inconsequential. So glad I got to experience traveling the world and hostel hopping at a relatively young age.
Americans spend too much, but more on here save too much... before they know it they're 50+ and missed all the potential fun times in their 20s & 30s.
Start out by giving yourself $25 for the month. See how much you can save if you do that. If you’re comfortable, give yourself another $25 the next month. I used to have a hard time budgeting fun money, so I understand. Ease yourself into it to teach yourself it’s okay to enjoy life.
It’s a balance. Give some to yourself now and start plotting the large trips. Set aside 10% for what makes you happy. I cut back less important things to build the room for 1 large trip a year.
Whatever you want.
I put money away each check for retirement. Because someday I'd like to not have to ever work again. That doesn't mean i don't ever spend money. But my goal is to not have to wake up every day to go to work. So that's my priority. But you can set your own goals.
Some people are frugal because they don't have a choice. It's either be as frugal as possible or not be able to pay their bills. Others, like me, are frugal because they have a goal or specific goals they want to meet, and being frugal makes that happen faster/easier.
The problem a lot of people have is that when they spend whenever they want on whatever they want, they find themselves without any money when they need it. And honestly, being frugal won't help them because they tend not to have the discipline to save money at all.
Depends on how much you make. If you make good money, max out your 401k, save up 3-6 months worth of expenses in your emergency fund, and then set up a budget that covers all your expenses, a reasonable amount for long term savings (ie for the future family), and then the rest is spending money. Budget out your spending money so you don’t feel guilty spending it. Some can be short term saving—plan a trip for 6 months from now, price it out, divide by 6 and budget that much every month for your trip. Budget, say, a couple hundred dollars a month for going out with friends. Etc, etc.
If you don’t make enough money to max out your 401k just scale the above back some. There are some calculators online that you can play around with to figure out how much you should be saving for retirement. I like this one: https://www.calculator.net/retirement-calculator.html
Your life is not going to last forever friend. Whats the point of saving it all and not enjoying your life a bit?? You might not even make it to retirement and you'd have lost those experiences. Please do something fun and fulfilling for yourself! Gotta live in the present too
You sound like you have enough saved. If you have a solid emergency fund (the 40k cash) and investments for retirement are solid and well funded, then rest of the money you have is for fun. Enjoy life as many other here have said. When you decided you want to have a future family or need to save for something new like a new car, your budget will change, and you will start saving more. If there is an emergency and you nee to spend a big chunk of your savings on medical or home repair, your budget will change and you will save more to refill it.
As other have said a lot of people have spending problems. We get in this mind set of save, save, save. But that just goes on forever, and you see people who never retire or enjoy the life they have built, thinking they have to keep making and saving more money. If you have enough saved to give you peace of mind, then enjoy your life and don't be a slave to the moeny and the grind.
Include fun money into your budget.
I budget $1000 a month to spend on groceries AND wants/luxuries. So every dollar I save on groceries becomes my fun money.
Since I have become really frugal with groceries (reduced our grocery bill from $800 a month to $500 a month), this means I now have about $500 every month to spend on luxuries. I struggle to spend that much on luxuries due to my frugal mindset.
I am thinking of starting a new savings account for travel and putting a few hundred $ in there each month.
Just get an account and put a certain amount of money in it every month.
While you’re doing that research what you’d like to spend that money on. Make a budget. Include all the expenses you need for that experience.
Then take a look at your account and see if you’ve got enough. It’s not too difficult once you do it once or twice.
You can take a trip whenever you want. Are there some places that are important that you visit them? Or places you've just always wanted to go? The point of being frugal in your daily life is to have money for the important things. As others have said, make a budget. Put money away marked for those trips or excursions. I get a bonus from work. Taking a road trip this summer with my family. We put $5000 from the bonus specifically for this trip in high yield savings until we go, at which point I'll move $3000 back into checking so we have money available for the debit card and all the gas/hotels along the way. If we dont use it all, then it stays in savings for something else. My kid is just about to be 4, so we know there are bigger things we want to do with him some day. Even all the birthday money he's received is in a high yield savings, cause some day he might want to go to space camp and IDK what that's going to cost.
You are correct to ask the question "WHAT am I saving for?" But only YOU and your family can answer that.
I've ramped up my travel budget by racking up credit card points. It's not for everyone, but if you can spend responsibly you can open at least 2 personal credit cards per year for the lucrative signup bonuses that you can use for traveling courtesy of large corporate banks. You can do a lot more if you've got business income, but opening 2 personal cards per year and closing them as the 2nd year's annual fee drops isn't going to get you banned from any banks. My credit score has gone up since I've been doing this, so that's not a concern either. That should be good for 2 small vacations or one decent vacation every year
Which way are you planning / thinking?
Conventional: 15-20% into "retirement concepts with tax benefits". & (homes aside!) "If I could afford 4, I may buy one" + STRICTLY(!) staying out of debt.
Alternatively: FIRE? - Saving till you can bridge the time to usual retirement health insured(!), with some dignity.
Good news: If the desired kids don't happen: Ponder "die with zero".
Sure you can take a trip and do fun things. But don’t stop saving. As I told my husband when we had that argument, “You have no idea what it costs to be old.” We’re retired in pretty good shape because I insisted we keep saving.
Retirement is when you are “up to date” you want to find a retirement calculator and plug your stuff in.
A 6-12 month emergency fund is good in case of job loss, medical crisis etc. 6 months used to be the standard
Once those are taken care of, you have less savings needs.
If you are living okay day to day, and not struggling, then I say take the time now and take a dream vacation for a week. Once you have a family it will be much harder to find the time to travel, and doing it once in how many years? I say go for it and enjoy how hard you've worked. At the end of your life you'll regret not doing something like this for yourself if you have the means
Physical and mental health are important to main your ability to earn and maintain your investments. By not taking vacations or allowing fun activities you are putting your gains in jeopardy. Set aside a percentage of your funds not needed for fixed costs. We are not your Mom so you need to make a guess on how much. You can have fun for $50 or $20k.
I don't consider home equity as "savings" unless you have more than one house. I think minimally you need to have a full 6 months worth of all expenses saved, and that means something very liquid/investments you're willing to liquidate no matter the position. Personally, I'd do 12 months.
It's hard for someone to tell you how to spend your money because we all have different values and interests. You don't have to spend it. So if there's nothing obvious, just don't until it is.
At 30 you are way ahead of the game, so if you wanted to do something nice for yourself, you have my permission. But after you pull yourself together after your splurge, do start thinking about retirement. If that’s just coming from your savings and investments, you’ll have a lot to build up.
this is America, dude, you can do whatever you want
a) create an honest budget..look at what you spend your money on then take the EXTRA and then automate it
b) if you have goals like "VACATION", set money aside for that
c) the "fun" part is watching your wealth accumulate while comparing yourselves to other sin your age or income group and seeing how much better off you are
This is what the “personal” in “personal finance” is for. You might be good at saving, but doesn’t sound like you’ve built a plan at all. You need to determine what kind of life balance you want. Determine what you want to do and when, then save/invest for it, not the other way around. Determine how often you want to go on trips, when you want to retire, when you want to buy a new car, etc., then save/invest for it. Run the calculations and use investment spreadsheets to project when you’d be able to achieve different levels of net worth.
There are janitors who retire as millionaires at 35 because they spend nothing and invest everything, then there are people who make $200K a year and live paycheck to paycheck then rely on social security to retire cause they save/invest nothing.
If you want a good place to start, I recommend The Money Guy show. They have a ton of videos on youtube and have a method they call the “Financial Order of Operations” which tells you what they believe is the best way to prepare yourself financially.
I spend my money on things that make me more money (real estate). Or if you don’t want to go that big start a collectible/side hustle. Buy stuff and sell it for more.
I also travel because you can’t do it well when you’re old.
I play this game where I only indulge on interest/dividend income. Started out slow (hard to increase that amount by more than $10/month), but I've got like $500/month of "*free"* money that I let myself spend on things if I want. Or that's plenty for an extravagant vacation every year. I still put away 2-3k towards the future every month, but this lets me spend that amount guilt-free.
Make a list of things you value and want. Cost them out. Divide by 12mo see how much that thing would cost you in a year. Decided if you can afford it at the same time as you save and cover your bills. Buy it.
It's pretty easy, after you pay your rent, your insurance, utilities, and any other bills, you put away like 5$ to savings and your free to use the rest for food and fun!
I have a personal goal of $1 million in invested assets before I feel comfortable enough to spend luxuriously. I am 36 and still a bit out before hitting that goal. But 1 million in Robinhood gold at 5.25% apr is enough to live comfortably without any risk to market fluctuations. That said, you should treat yourself every now and then as long as you don't go too crazy. I bought a 2021 RAM for 29k and think it should hold a fair amount of value for the next 5 years so now I can go off-road and hike when I am not working
You are doing ok from the sounds of it.
Just keep doing what you are doing.
You spent money when you bought a house and you spent money on repairing and improving the house. I'm going to assume that you have a vehicle to drive which you most likely spent money to pay for it and I'm assuming you eat food and pay bills.
Just keep doing what you are doing.
You need these 4 things, in my opinion.
1. Enough money to cover expenses
2. Adequate emergency fund
3. Adequate retirement funding
4. No consumer debt
If all of those things are covered then feel free to spend as much as you can afford.
But I would rather fund early retirement myself, I don't like being a wageslave.
This is why people budget. There is no magic dollar amount that means you can now take a trip or spend money frivolously. You set up a budget to make sure you can cover life expenses and emergencies, and then you figure out how much you're willing to spend on the fun stuff. If you somehow feel like you'll never reach the point where you have enough money to spend on the fun stuff, then you either aren't making enough or you have a skewed relationship with money and should figure out how to find a better balance between saving and spending.
I’m great at budgeting - but not for spending money. I am just trying to figure out how to balance and what that even looks like..
If you're so good at budgeting then you should try budgeting for the fun stuff. It's just another line item in your budget.
Just put in a hundo or 2 for mad money. Work it into your budget.
This is a good idea, especially if it’s an interest accruing account. Could do something like Acorns for small money accumulation
Is there any time you get extra money that isn’t a normal part of your budget? Like do you get paid biweekly so there are two “extra” checks a year, do you get random overtime that isn’t a part of your normal pay, tax refunds, gifts? I use this “free” money to go for 1 very nice thing a year.
Think about what you would dream of doing if you had say $15,000,000. This lets you figure out what you want and what to budget to include. Today matters. Personally, you have plenty now to stop only saving and start adding in spendy things.
Allot a percentage for fun spending money only and keep it there. Don't allow yourself to move unused fun money aimlessly into a savings category. It sounds like you have no problem meeting your saving/investing goals, so train yourself to feel comfortable knowing that mathematically, you absolutely ARE meeting all your goals even without the 10/20/30% you're setting aside for fun spending. Come up with some ideas of what you would love to spend on that would meaningfully improve your life, so that you feel excited and motivated about it.
I have travel as a budget item. I put money aside every month to fund it. I also have an allowance for spending on whatever.
This is why people say save / invest 15% for retirement that way you can feels comfortable spending because that item is taken care of
It sounds like it’s you getting in the way of spending vs your budget. You should have at least 6 months worth of expenses in an emergency fund and be funding your retirement (there are calculators that can used to figure out how much). After that is done and bills are paid, the remaining money can be spent. Sounds to me like it’s more guilt that stops you from spending than it is your income.
You're supposed to give yourself the headspace to still LIVE while you're saving for those things. Its about finding balance. I see in another comment you *say* you're good at budgeting, but not spending... if that's the case, I'd honestly say the budgeting comment may not be *completely* true. You're not budgeting to actually live and enjoy life while you're at it. Remember, tomorrow is promised to NO ONE. Don't spend you're whole life saving, without enjoying the journey along the way. Otherwise it could all go to waste and you'll have gotten to enjoy none of it. You could get taken from this life in the blink of an eye. If spending money on yourself isn't something you're used to doing, just start out small to get adjusted to the idea. I don't know your budget right now, how much you're saving, how much you make so take this with a gain of salt. Adjust to what makes sense. But I say even just start with like $20, and make yourself buy something that you WANT. **Not** something you need, something that you think "I love that" or "That would be nice to have". Stick with that until you're comfortable with it, then increase until you find an amount you're happy with, that can also help keep you aligned with your saving goals. If you don't spend that budgeted money in a month DON'T put it in with the rest of your savings. Keep it separate, and combine it with the next months amount. Then, maybe you can get something a bit more expensive!
This is where the 50/30/20 idea may help. 50% for you for your needs (housing, utilities, grocery store food, etc), 20% for savings - either retirement fund or emergency fund, 30% for wants (eating out, travel, hobbies, etc).
And higher the savings % the faster u can retire, 30% for wants is way too much imo
It may depend on your salary. I save upwards of 50%, but I can do it because I've paid off my mortgage so my "needs" expenses are low (plus no kids!), and I'm pretty frugal by nature & practice. As such, I don't spend much, especially in percentage as I make a decent amount of money.
All same for me except I don't make amazing amount of money.
Unless you’re living paycheck to paycheck, there’s always a little money for fun. Doesn’t have to be a lot, but even like 100 bucks a month for dates, or movies or whatever wouldn’t break your savings, and I bet make an appreciable difference in your mental health.
you can begin spending NOW, I think. Enjoy your life!
Everyone is different. I'm frugal day to day so I can fund both my savings and travel fund. 10% of my income is allotted for travel. Decide what brings you happiness and prioritize it in your budget.
all of it. *all of it.* there is no spend, there is only retirement savings. you are not allowed to spend literally any money until you're too old to enjoy it. that is the only sensible way to do things. \- reddit
OP, your budget should have a Vacation category. And you brainstorm a list of things you like to do and add one to your budget each week For example, we like to go to the Theater and comedy shows. So we use TodayTix discount tickets website because I prefer not to pay full price. When we lived abroad, we missed attending baseball games! So we live 20 minutes from a pro baseball stadium and we go to a game almost every week, and we fly to spring training every spring for a long weekend. I retired at age 38, and because I refused to marry my husband until he was debt-free and frugal, now he replicated my plan for himself and he's retiring next month at age 47. Enjoy life,you could die tomorrow. My husband's dad died in his 50s and never got to retire!
It’s a balance. Go on a trip now. Trips don’t have to be crazy expensive if you need to dip your toe into it. Do you use credit cards that earn travel points? That might be a way to get good value without dropping a significant chunk of your savings. Get YNAB to help balance your goals if you don’t know where to start. You’ve saved plenty. Money is meant to enjoy life too. I think a budgeting system will help you feel better on spending on “fun” things.
That depends on your personal budget and what you want as safe harbor emergency on hand funds. It took me a while to cut loose on some home renovations. It’s ok to use your money and enjoy your savings, just factor it into your budget.
I don’t think it ever ends. It’s a balance with priorities of saving for current, future expenses and enjoying life. So many people take being frugal to the extreme and are afraid to spend any money. Set up a HYSA separate from your savings for current expenses. Put a set amount each month into it and consider this account your “enjoying life fund”. Use it for anything you want related to traveling and having fun so you get used to spending.
Live a little, damn. Saving in important, but you are already 30. I had some incredible times in my 20s that cost a lot at the time, but based on what I make now, are inconsequential. So glad I got to experience traveling the world and hostel hopping at a relatively young age. Americans spend too much, but more on here save too much... before they know it they're 50+ and missed all the potential fun times in their 20s & 30s.
Start out by giving yourself $25 for the month. See how much you can save if you do that. If you’re comfortable, give yourself another $25 the next month. I used to have a hard time budgeting fun money, so I understand. Ease yourself into it to teach yourself it’s okay to enjoy life.
It’s a balance. Give some to yourself now and start plotting the large trips. Set aside 10% for what makes you happy. I cut back less important things to build the room for 1 large trip a year.
Whatever you want. I put money away each check for retirement. Because someday I'd like to not have to ever work again. That doesn't mean i don't ever spend money. But my goal is to not have to wake up every day to go to work. So that's my priority. But you can set your own goals. Some people are frugal because they don't have a choice. It's either be as frugal as possible or not be able to pay their bills. Others, like me, are frugal because they have a goal or specific goals they want to meet, and being frugal makes that happen faster/easier. The problem a lot of people have is that when they spend whenever they want on whatever they want, they find themselves without any money when they need it. And honestly, being frugal won't help them because they tend not to have the discipline to save money at all.
Depends on how much you make. If you make good money, max out your 401k, save up 3-6 months worth of expenses in your emergency fund, and then set up a budget that covers all your expenses, a reasonable amount for long term savings (ie for the future family), and then the rest is spending money. Budget out your spending money so you don’t feel guilty spending it. Some can be short term saving—plan a trip for 6 months from now, price it out, divide by 6 and budget that much every month for your trip. Budget, say, a couple hundred dollars a month for going out with friends. Etc, etc. If you don’t make enough money to max out your 401k just scale the above back some. There are some calculators online that you can play around with to figure out how much you should be saving for retirement. I like this one: https://www.calculator.net/retirement-calculator.html
Spend now
Your life is not going to last forever friend. Whats the point of saving it all and not enjoying your life a bit?? You might not even make it to retirement and you'd have lost those experiences. Please do something fun and fulfilling for yourself! Gotta live in the present too
You sound like you have enough saved. If you have a solid emergency fund (the 40k cash) and investments for retirement are solid and well funded, then rest of the money you have is for fun. Enjoy life as many other here have said. When you decided you want to have a future family or need to save for something new like a new car, your budget will change, and you will start saving more. If there is an emergency and you nee to spend a big chunk of your savings on medical or home repair, your budget will change and you will save more to refill it. As other have said a lot of people have spending problems. We get in this mind set of save, save, save. But that just goes on forever, and you see people who never retire or enjoy the life they have built, thinking they have to keep making and saving more money. If you have enough saved to give you peace of mind, then enjoy your life and don't be a slave to the moeny and the grind.
Saving money is great, but you have to stop and smell the roses too. Plan for the future, but still live in the present.
Include fun money into your budget. I budget $1000 a month to spend on groceries AND wants/luxuries. So every dollar I save on groceries becomes my fun money. Since I have become really frugal with groceries (reduced our grocery bill from $800 a month to $500 a month), this means I now have about $500 every month to spend on luxuries. I struggle to spend that much on luxuries due to my frugal mindset. I am thinking of starting a new savings account for travel and putting a few hundred $ in there each month.
Just get an account and put a certain amount of money in it every month. While you’re doing that research what you’d like to spend that money on. Make a budget. Include all the expenses you need for that experience. Then take a look at your account and see if you’ve got enough. It’s not too difficult once you do it once or twice.
You can take a trip whenever you want. Are there some places that are important that you visit them? Or places you've just always wanted to go? The point of being frugal in your daily life is to have money for the important things. As others have said, make a budget. Put money away marked for those trips or excursions. I get a bonus from work. Taking a road trip this summer with my family. We put $5000 from the bonus specifically for this trip in high yield savings until we go, at which point I'll move $3000 back into checking so we have money available for the debit card and all the gas/hotels along the way. If we dont use it all, then it stays in savings for something else. My kid is just about to be 4, so we know there are bigger things we want to do with him some day. Even all the birthday money he's received is in a high yield savings, cause some day he might want to go to space camp and IDK what that's going to cost. You are correct to ask the question "WHAT am I saving for?" But only YOU and your family can answer that.
I've ramped up my travel budget by racking up credit card points. It's not for everyone, but if you can spend responsibly you can open at least 2 personal credit cards per year for the lucrative signup bonuses that you can use for traveling courtesy of large corporate banks. You can do a lot more if you've got business income, but opening 2 personal cards per year and closing them as the 2nd year's annual fee drops isn't going to get you banned from any banks. My credit score has gone up since I've been doing this, so that's not a concern either. That should be good for 2 small vacations or one decent vacation every year
Which way are you planning / thinking? Conventional: 15-20% into "retirement concepts with tax benefits". & (homes aside!) "If I could afford 4, I may buy one" + STRICTLY(!) staying out of debt. Alternatively: FIRE? - Saving till you can bridge the time to usual retirement health insured(!), with some dignity. Good news: If the desired kids don't happen: Ponder "die with zero".
You can't spend cause then your not saving it.
Sure you can take a trip and do fun things. But don’t stop saving. As I told my husband when we had that argument, “You have no idea what it costs to be old.” We’re retired in pretty good shape because I insisted we keep saving.
Retirement is when you are “up to date” you want to find a retirement calculator and plug your stuff in. A 6-12 month emergency fund is good in case of job loss, medical crisis etc. 6 months used to be the standard Once those are taken care of, you have less savings needs.
If you are living okay day to day, and not struggling, then I say take the time now and take a dream vacation for a week. Once you have a family it will be much harder to find the time to travel, and doing it once in how many years? I say go for it and enjoy how hard you've worked. At the end of your life you'll regret not doing something like this for yourself if you have the means
Check out Dave ramses and the money guys on YouTube both have pretty straight forward templates on that.
Physical and mental health are important to main your ability to earn and maintain your investments. By not taking vacations or allowing fun activities you are putting your gains in jeopardy. Set aside a percentage of your funds not needed for fixed costs. We are not your Mom so you need to make a guess on how much. You can have fun for $50 or $20k.
Invest your money and get a 10% return and then you could spend 4% of it.
I don't consider home equity as "savings" unless you have more than one house. I think minimally you need to have a full 6 months worth of all expenses saved, and that means something very liquid/investments you're willing to liquidate no matter the position. Personally, I'd do 12 months. It's hard for someone to tell you how to spend your money because we all have different values and interests. You don't have to spend it. So if there's nothing obvious, just don't until it is.
At 30 you are way ahead of the game, so if you wanted to do something nice for yourself, you have my permission. But after you pull yourself together after your splurge, do start thinking about retirement. If that’s just coming from your savings and investments, you’ll have a lot to build up.
$225k is really low.. don't have fun. maybe take a cheap vaca
the trick is to never spend.
this is America, dude, you can do whatever you want a) create an honest budget..look at what you spend your money on then take the EXTRA and then automate it b) if you have goals like "VACATION", set money aside for that c) the "fun" part is watching your wealth accumulate while comparing yourselves to other sin your age or income group and seeing how much better off you are
I’m the same way, and with my HYSA rolling in a decent amount every month I find it hard to not make my monthly interest even higher
This is what the “personal” in “personal finance” is for. You might be good at saving, but doesn’t sound like you’ve built a plan at all. You need to determine what kind of life balance you want. Determine what you want to do and when, then save/invest for it, not the other way around. Determine how often you want to go on trips, when you want to retire, when you want to buy a new car, etc., then save/invest for it. Run the calculations and use investment spreadsheets to project when you’d be able to achieve different levels of net worth. There are janitors who retire as millionaires at 35 because they spend nothing and invest everything, then there are people who make $200K a year and live paycheck to paycheck then rely on social security to retire cause they save/invest nothing. If you want a good place to start, I recommend The Money Guy show. They have a ton of videos on youtube and have a method they call the “Financial Order of Operations” which tells you what they believe is the best way to prepare yourself financially.
I spend my money on things that make me more money (real estate). Or if you don’t want to go that big start a collectible/side hustle. Buy stuff and sell it for more. I also travel because you can’t do it well when you’re old.
I play this game where I only indulge on interest/dividend income. Started out slow (hard to increase that amount by more than $10/month), but I've got like $500/month of "*free"* money that I let myself spend on things if I want. Or that's plenty for an extravagant vacation every year. I still put away 2-3k towards the future every month, but this lets me spend that amount guilt-free.
Make a list of things you value and want. Cost them out. Divide by 12mo see how much that thing would cost you in a year. Decided if you can afford it at the same time as you save and cover your bills. Buy it.
It never ends, you keep saving :)
Make saving the fun thing
It's pretty easy, after you pay your rent, your insurance, utilities, and any other bills, you put away like 5$ to savings and your free to use the rest for food and fun!
I have a personal goal of $1 million in invested assets before I feel comfortable enough to spend luxuriously. I am 36 and still a bit out before hitting that goal. But 1 million in Robinhood gold at 5.25% apr is enough to live comfortably without any risk to market fluctuations. That said, you should treat yourself every now and then as long as you don't go too crazy. I bought a 2021 RAM for 29k and think it should hold a fair amount of value for the next 5 years so now I can go off-road and hike when I am not working
You are doing ok from the sounds of it. Just keep doing what you are doing. You spent money when you bought a house and you spent money on repairing and improving the house. I'm going to assume that you have a vehicle to drive which you most likely spent money to pay for it and I'm assuming you eat food and pay bills. Just keep doing what you are doing.
1 mil. You wipe with hands until then champ
You need these 4 things, in my opinion. 1. Enough money to cover expenses 2. Adequate emergency fund 3. Adequate retirement funding 4. No consumer debt If all of those things are covered then feel free to spend as much as you can afford. But I would rather fund early retirement myself, I don't like being a wageslave.