I am 28 in a position of night shift leadership at a local cultural institution. I am also a college student, paying out-of-pocket for a state school Psychology/Poli Sci degree.
I've been in my position for four years, at my institution for eight. I am on a final disciplinary warning, which ends at the end of Summer. I have $12k in savings against $1300-1500/month base expenses and $46k in a pre/post tax investment account (5% contributions in each)
I am nearly finished with funding for Summer and Fall tuition (total of $7300) and I plan on maxing out my Roth this year. I am getting a $7k gift from my dad and I plan to round out school tuition with $1800, rest is Roth.
Is $12k in savings enough?
feeling precarious with my job security but I have savings
byu/hhotguac inFrugal
Posted by hhotguac
1 Comment
You are actually in a pretty solid position for 28, especially since you are paying for school out of pocket.
Your expenses are only about $1300 to $1500 a month. With $12k in savings that is roughly 8 months of expenses, which is already a strong emergency fund. Even if you use about $1800 of that for tuition, you would still have around $10k left, which is about 6 to 7 months of expenses. That is still a very reasonable safety cushion.
Given that you are currently on a final disciplinary warning, the safest approach would be to keep at least about 6 months of expenses in cash until that situation passes. I would not drain your savings just to max the Roth all at once. It would be safer to contribute to the Roth gradually from your paychecks instead of pulling a big chunk from your emergency fund.
Your bigger priority right now should simply be stability for the next few months. Get through the warning period, finish funding tuition, and keep your cash buffer intact. Once the warning expires and your job situation is stable again, you can be more aggressive about investing.
Also, having $46k already invested plus your savings is a strong financial position for someone your age, especially while still in school. The main thing is just protecting your liquidity until your income risk goes back down.