I make $65000 (70k with bonus) as a 23 year old. Just graduated
I have 15k in savings
30k in tuition debt (couldn’t afford to pay it off during school and parents couldn’t help me out as I was paying rent and a little bit of the tuition)
The 30k in loans are interest free with OSAP. So I’m no rush in paying it off.
I have 15k in investments
10k in cash (in my TFSA account)
Total: 40k
Should I just keep saving/investing
I have minimal expenses (car paid off, not renting)
Graduated 23 years old
byu/Brilliant_Till_2139 inpersonalfinance
Posted by Brilliant_Till_2139
14 Comments
Or should I try to pay off my debt quicker
Build 6 month emergency fund, which 10k might be if you aren’t renting and no car payment.
If your company offers a 401k you need to minimally contribute the amount that your company matches.
Work on your loans if you have no real debts or expenses. If you can tackle those and be able to focus all your future money towards goals/investments, you will set yourself up nice.
Not sure about that but I bet 100’s of 23 year olds would LOVE to be in your position! Nice job…
people will have a a lot of mixed opinions on paying off the debt early. some will say to do it aggressively, but since you have no interest and time on your side, i would really focus on getting money into your 401K(match what your employer is matching), and max out your Roth IRA. Increase 401K contributions if you can but figure out a sustainable budget first. you’ll be just fine
What are your goals?
Use those to determine what your saving and investing strategy is.
I was in a similar boat as you at your age. I decided to invest in myself in my 20s. Grad school, certifications, personal trainer, second language classes, etc…
Now i’m 30 and have amassed a balanced portfolio and resume.
America’s unaffordable top hat: /r/PersonalFinanceCanada
Here is what I do if I’m you
1. Max Roth IRA
2. 10-15% into a taxable brokerage
3. 10-15% into your 401k if available
4. Go on trips enjoy life
5. Have 6 month emergency fund this is usually first but 10k might do it for you since it seems you don’t have many bills
6. Save for a house maybe 5% a check no better time then now and keep in HYSA
7. Pay off debt since your is 0% there is zero reason to pay it off fast make sure it’s paid off by the time it starts to accrue interest
I’m Canadian by the way.
With any student loans or any credit card debt from school, make a plan to crush it now so you dont deal with it later. It’ll also lower your interest if you pay it of now saving you money. While you pay with saving you still have enough after to continue putting into savings. Invest when you see a significant amount of the debt go down.
You are doing great. At 23, I had tons of credit card debt and student loans.
Your analysis is solid.
Keep investing what you can each pay check. Very low fees ETF like VOO would be my suggestion.
Kudos to what you have achieved already
6 month exspenses.
Pay any debt above 7%.
The rest invest.
People here suggesting a Roth IRA while OP mentions a TFSA in their post :/
The real question is obviously whether OP should fund their superannuation more or put it towards an ISA!
good job
I’m so proud of you. Your achievements are truly remarkable and already surpass most of your peers. You’ll look back on your decisions today and be glad you made them