How does yours compare?
- It is important to have cash on hand for emergencies and different purposes.
- The middle thirties may have more money than you think.
Having money in savings is important. First, you need to have a fully loaded emergency fund because you never know when life might throw a curveball at you. If you were to lose your job or find yourself stuck with an expensive car or home repairs, having no savings could mean having to rack up expensive credit card debt.
Additionally, you may have different goals for which you are saving, such as buying a home or renovating an existing home. And a savings account is a great place to put that money.
Now, you might end up having more cash savings in your 30s than in your 20s. That’s because your 30s may be the time when you finally make more money at work and finally get rid of the annoying debt you accumulated in college.
But do you have a lot of savings for your age? A small quantity? Somewhere in between? If you are curious about this, read on.
What 30-somethings have in savings
The average savings balance for people in their 30s is $35,434, reports Personal Capital. Now, before we go any further, let’s talk about averages for a second.
When taking an average, it is possible that a few very large numbers will pull the final number up. This is why it may be more useful to know the median savings balance of 30-somethings. But unfortunately, we only have the average to work with.
It’s also worth noting that while the average cash balance in savings for 30-somethings is $35,434, that doesn’t necessarily represent everything money that people have. Personal Capital also reports that the average person in their 30s has $29,229 in a checking account and $28,148 in what it calls “other” cash. It may be money earmarked for a specific purpose – it’s hard to tell.
Are you happy with your savings account balance?
It’s natural to want to know how much other people your age are saving. But whether you have more than $35,434, less, or a comparable figure, the reality is that it’s important to assess what your savings balance means to you.
Let’s say you have $36,000 in your savings account (because that’s a nice round number), and the purpose of your savings is to serve as an emergency fund. If you spend $6,000 a month on expenses, guess what? You’re actually in pretty good shape when it comes to an emergency fund.
On the other hand, let’s say you have the same $36,000 in the bank, but you live in an expensive part of the country and spend $10,000 a month on expenses. In this case, you only have enough money to cover about three and a half months of living expenses. If your goal is to have six months’ worth, you’re short.
That’s why, while it’s okay to compare your savings to those of an average 30-something, ultimately you should assess your personal needs and aim to save enough money to give you the financial security you deserve. . You may only have $18,000 in savings. But if you keep your living expenses at $3,000 per month, you’re in the same good shape as someone with $36,000 in savings who spends $6,000 per month.
In fact, comparing your savings to those of other people should only be an exercise in curiosity. You shouldn’t let him feel bad about yourself or dictate what goals you set for yourself.
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