Currently 28 y/o. Graduated from college 7 years ago. Didn't really get a career going, worked entry level for 5 years. Made 7.25-12$/hr moved up to a better job in the last 2, still entry making 21/hr. Since then up until now, I've saved up 18K on a 40k salary. I have an associates degree as well as 6k in a 401k. Just payed of student debts and my car last year. Living with my girlfriend in a pretty big city(Houston/Dallas/Austin). At this age, would you guys consider this to be just "ok"?
28 years old with only 18k in savings
byu/Independent_Net_838 inpersonalfinance
Posted by Independent_Net_838
10 Comments
I think you’re doing fine and you just need to stay aggressive with your saving.
I was probably making around 75k at your age and was not great at saving. Also I was impacted by the tech bubble in 1999 and also the housing downturn in 2007-8.
Long story short if I look back my net worth was about $10k at age 35… I’ve saved aggressively since then and am at just over $2M net worth now at age 54. You just have to go in that direction and stay disciplined.
18k on a 40k salary aint bad at all. I didnt have that much until I was much older.
It aint enough to retire on, but if you didnt add another penny, and you put in the s&p 500, youd have around 180k at time of retirement.
You are more OK than someone with less savings and less OK than someone with more savings.
If you want to measure your progress in a meaningful way, take some time to identify your priorities and goals, and then make a budget: https://www.reddit.com/r/personalfinance/wiki/commontopics
A good budget is one that gets you to your goals on a timeline you are happy with. A budget that shows that you need to make changes to your income, expenses or goals does not.
Paying off those debts is good. But by pure numbers is would say your current state is a bit below average. Median salary for a 28 year old male is $53,000.
Your cash savings is about right on par with the median which seems to be about $20,000.
I’d say just try to find ways to up-skill and increase your salary and you’re chilling.
You’ve definitely got a better head on your shoulders than most 28 year olds.
Savings is the type of thing where more is always “better”. Realistically though, 18k can be one or two unfavorable circumstances away from being depleted and then where are you? You gotta bump up your overall income while you have the opportunity to have your expenses lowered due to your partner paying half the bills. I was always stuck at 65k per year at all my desk jobs until I got into trade school for HVAC. Now my union pays me 107k+ per year
Thats not bad really. I know plenty of people in their 50s who don’t have that much saved. Would getting a higher degree help with your income?
The average American Household (2.5 kids et al) has under $4,000 in savings. So you’re way ahead. Invest in a market following fund or government bonds.
You’re doing bad.
Paying off your student loans is huge.
What I would do at this point:
First, make sure your $18k in savings is in a HYSA so you are earning interest.
Second, open a Roth IRA (not a traditional IRA, a Roth IRA) at Schwab, Fidelity, or Vanguard. Transfer $7500 into the Roth IRA and invest in something simple like VT.
Obviously, this will massively cut your savings. However, you only have $6k in retirement savings and that is low for your age. Adding $7500 right now (the max for 2026) should be $90k when you retire. It is 100% worth making this investment now.
That is a lot of savings for a young person!!! Keep up the good work- you are WAY ahead.
bro I’m 28 with no savings, 10k in credit card debt and 22k left on my car note. You’re doing fine. Can you do better? Sure but with 18k saved and no debt you’re ahead of a lot of (dare I say most) people.
I’d keep a portion of the 18k as an emergency fund in a hysa or something easily accessible and invest the rest either in the 401k or just a separate account.