I have worked pretty hard and I’m now fully qualified in my dream job. M 24 and I’m earning €132,000 NET per year.
Household spending (rent, car, groceries, bills etc) is currently around €3000 per month
My savings plan per month is the following:
Saving for house : €2000
Investing (S&P500) : €1,500
Holidays: €750
Other: €1000
This leaves €2,350 in my account for discretionary spending. I plan to split what is left at the end of each month between house savings and investments.
Does this seem smart? I know I’m very fortunate and I’m extremely grateful for the position I’m in.
Am I being smart with my money?
byu/Ill_Pie_9955 inpersonalfinance
Posted by Ill_Pie_9955
5 Comments
Helluva holiday fund at 18k per year.
If you are serious about buying sooner rather than later, I might consider lowering that and also lowering your discretionary.
But you are in a good financial position regardless.
Impressive for 24y/o indeed!
Depending on your country you may have interesting tax-advantaged options that you should not neglect.
What is your timeline for buying a house? What is the interest rate on those cash savings (house, vacations, others…)
It is good to earmark some of the cash savings as an emergency fund, a buffer for unexpected expenses that avoids having to dip into long-term investments at a loss.
>>> Holidays: €750 Other: €1000
To me, 750 for holidays per month seems excessive. And 1000 seems like play money; it’s a lot of money, I’d want to know where it’s actually going.
Be careful about increasing your standard of living, going back is difficult and painful.
If your home savings are going to be used withing the next 5 years, it should be in a HYSA, not the stock market. Otherwise you face the risk of a market down turn trashing your savings just as you need it.
Its smart to me and I’m an accountant by trade. Just don’t let lifestyle creep get to you as you go along with your career.