My take home pay is only $2800 after taxes and investing $1,000.00 into my retirement account. I don't think I will make $100,000/yr in my lifetime, but I am happy with my salary based on my current expenditures.
However, I have no debt or loans. I live in a walkable city, and my work reimburse my monthly transit pass, so I don't have a car nor do I have any dependents. I don't travel internationally. I plan to go to Japan, but that is in the far future.
Currently have 7k in my checking account and 20k in my savings. (April 2026) The 20K is in a CD with Chase at 3.5% APR. I know about HYSA banks, but I feel more comfortable being in Chase's ecosystem and at 3.5% APR for 2 months, I don't think that is that bad for me to store my money until I make a decision to whether I would want to put the 20k in a HYSA.
Based on my fixed expenses and calculating my variable expenses, I anticipate I will have $12k in my checking account by the end of 2026.
Together, I would have around $32,000 in total liquidity.
My retirement account only has around $10,000 right now. However, given the 1 YR 25% ROR and the $1,000 monthly contributions that is going in right now, the projected balance at the end of 2026 would be around $20,000.00.
I work in public service, so I am also investing into a mandatory pension.
I also get 5% merit-based adjustment until I cap out my salary range. Currently I make around $5,110 and I max out at around $6,550. I get 5% raises annually until I get to the cap, which would take 5 years.
After I get my 2nd 5% MSA raise, I will increase monthly contribution to $1,200.00.
So in summary.
At current:
Checking Account: $7,000
Savings (in CD): $20,000
457B: $10,000
Projected ending balance in 2026:
Checking account: $12,000
Savings: $20,700
457B: $20,000-$21,000
Can I afford to spend money in leisure in 2026, or should I continue to save agressively?
How long should I continue saving in this economy before I can start spending?
byu/Altruistic-Pace-2240 inpersonalfinance
Posted by Altruistic-Pace-2240
8 Comments
Seems like all your ducks are in a row. As long as you don’t have any aggressive plans to FIRE or anything, it seems reasonably to spend a little glamorously. I’d just recommend remaining cognizant, and not getting carried away. .
Start here: https://www.reddit.com/r/personalfinance/wiki/commontopics.
Budgeting: https://www.reddit.com/r/personalfinance/wiki/budgeting
How old are you?
Why dont you invest in long term compund interest? Cd’s are okay but u need to invest in order to get money back in the future
If you are in your 20s you are doing fine. If you are in your 30s then you need to increase contributions some. If you are 40+ then you will need to agressively save for retirement IMO.
How stable does your public service job feel? Some cities are making aggressive cuts due to costs
Dude you’re in a really good spot honestly. No debt, investing $1k/month into retirement, no car expenses, walkable city. That’s like the r/personalfinance dream setup.
If you’ve got 6 months expenses saved up, go enjoy your life a little. The whole point of being responsible with money is so you CAN spend on things you enjoy without guilt. Don’t fall into the trap of saving forever and never actually living.
It varies quite a bit depending on age/location and lifestyle. My first thought is unless you are under 25 is that you are ahead of the average person, but behind where you need to be. A few potential expenses coming up:
* House down payment – $100,000 – 200,000
* Kids – $250,000 – $2 million each
* Retirement – $1-10 milllion
Do most people hit these numbers, no. However, the average person is in a terrible financial state.
You’re already doing better than like 90% of people your age if you have no debt, 28k in a HYSA, and you’re putting $1000/mo into retirement. Go to Japan dude. Life’s too short to just stack money when you’ve already got the fundamentals covered.