I (24, M) just reached $40,000 in savings with about $15,000 in my workplace’s 401k also. I live at home with parents for now so Iow expenses , and I have no debt. Annual income is about $45,000 after taxes working in marketing (not learning much from there, little room for growth).
I’ve always aggressively saved at least half of my paychecks, and I’m used to not spending a lot on “fun”. While I know I’m doing decent for my age, it still feels like there’s always something more to save for. If I need a new car, that would be a good 15-20k. If I get married there’s engagement rings and wedding costs.
Investing is obviously the next step for me (looking into a Roth IRA) but how much is too much in savings?Am I just being too proactive?
It never feels like enough.
byu/lifeofnero inpersonalfinance
Posted by lifeofnero
18 Comments
Sounds like you’re saving to save and you’re not actually defining any tangible goals. That’s a real easy way to burn out.
You’re doing great saving that much on that income. It is a good idea to invest, high interest savings account, etc. but I think it sounds like you want a different goal now – maybe increasing your income should be the focus, so you can have more money to work with and not be as focused on saving.
What are you saving for? Are you going to retire early? Whats your plan? Kind of sounds like you dont have any….?
Tbh go live man your 24. At 45k salary with how much you’re saving it sounds like you sacrifice life for savings. Go live your life and buy dumb stuff
You’re actually doing quite well for your age savings-wise. Your largest hindrance is gonna be your income. Focusing on how to increase that should be your main focus for the foreseeable future. Invest as much as you can but spending a lot of energy pinching pennies won’t deliver you nearly as much value as upskilling will.
That’s because it isn’t enough.
Don’t get me wrong, you are doing great for your age ..but you are 24…you obviously aren’t going to have been able to save for everything you need to save for by now.
What you need to do is set reasonable goals so you can intelligently save and know what you can spend on fun so you don’t burn out.
Vs mindset of saving everything you can and avoiding fun
Make sure your cash is in a HYSA. Max your Roth IRA and keep putting money into your work 401K. IMO, 40K in cash is way too much given your situation.
Dude congrats on getting an amazing head start. You’re well ahead of the game for others your age and then some… But go live a little. You could walk outside and get hit by a bus tomorrow and for what?
Aim for the things that really matter to you in life and what you think will matter to you in the future. You are young, as you get older you will realize a lot of the general wants and needs of society may not apply to you. Focus on saving for the things that will actually make your life better and avoid things that you will potentially regret shortly after. For example you seem pretty frugal in a good way. A big wedding where you blow ridiculous and ruinous sums on a one day affair may be something that will detract from the experience, not add to it. There is no law saying weddings have to be huge expensive affairs. I personally hand made my wife’s wedding ring when I got married and she loved it. Obviously that’s not a fit for everyone but what I am saying is don’t be a drone that just allocates money and resources into things that don’t really matter to you. Otherwise dude you sound like you are on a good path. Wealth grows over time, you need to remind yourself that you are still very close to the start.
Hey OP, you’re good.
I moved back in with my parents at 24 with about 10k saved, no Roth, no 401k, making around 45k. You’re already ahead of where I was, and honestly ahead of a lot of people.
The tricky part is savings never feels like enough. There’s always another “what if” or future expense. That doesn’t really go away, it’s more of a mindset than a number.
What helped me was shifting from just stacking cash to giving my money a job.
I opened a Roth IRA and started putting in what I could consistently. Nothing crazy, just building the habit. At the same time, I kept a solid emergency fund and stopped stressing about hitting some perfect savings number.
At your point, it’s less about saving more and more about building systems (Roth, 401k contributions), investing consistently
and actually allowing yourself to enjoy some of your money.
You’re not behind, and you’re not underprepared. If anything, you might just be a little too locked into “save mode.”
FWIW, at 24 I would invest most of that $40K in some sort of index fund/etf and then forget about it. Assuming you get typical market returns for the next 35 years (which is absolutely not guaranteed), you would turn $50K into around $1.5M without putting another cent in (which you should put many cents in).
Sounds like you have more anxiety issues than personal finance issues, because financially you’re doing fine. But if you don’t see room for job growth, you may also want to figure out what to do about that.
You’re doing great!!!!!!!!! Keep up the saving you’ll be fine.
Yes, saving is pretty much a life long activity.
You’re doing great! Now it’s time to set goals and strike a balance in your life between goals and fun.
For example, you could set a goal to save 1x your annual income in retirement accounts by 30. You could set a goal of saving $x for a car in x years so that you can buy it outright and skip the loan. You could set a goal to set aside x amount a money for vacations, Christmas, concerts, etc.
You might have too much cash on hand at the moment. Keep 6 months of emergency fund in cash. Then max out your Roth IRA for 2026 ($7.5k). The rest could be invested in a brokerage. Some could go to a big purchase, like a car. Maybe even take a trip?
Again, you’re doing great! Goals will help provide you direction and meaning to your saving. And don’t forget to spend things on yourself every once in awhile since you can afford it and you don’t want to burn out.
All the comments here around having a plan and goals are great, I’d just like to add that you don’t *have to* do or *need* anything people (usually older peers) tell you.
You don’t *need* a new car. In fact, you may not need to drive at all. You don’t *have to* have a traditional wedding with engagement rings and $$$ wedding – your future partner might not even want that. You don’t *have to* buy a house.
Tread your own path and make your own choices. Investing and savings will give you the security and peace of mind to make them with confidence.
Honestly, worry less about saving
Worry more about finding a higher paying job, if you reached the cap (as you claim) don’t pigeonhole yourself and stay
You way ahead of most people. Secondly you can always buy a cheap car . Give yourself some grace and I promise you’ll be fine
You’re doing a great job. Keep it up and treat yourself once in a while. Then set goals.
It sounds like you have a very poo comparison model. Most people no matter the age, do not have the amount of money you have saved + invested.
There is nothing wrong with wanting better. But you should be more appreciative and less harsh on yourself it does come across a bit tone deaf (though it’s not your intention)