#SavingInYour20s #FinancialDecisions #PersonalFinance
Is Saving Your Twenties Away the Right Choice?
Are you in your 20s and feeling like you are wasting away your youth by saving every penny? It’s a common dilemma faced by many young adults who are torn between the desire to make smart financial decisions and the fear of missing out on life experiences. Let’s explore whether saving in your 20s is really worth it in the long run.
Benefits of Saving in Your 20s
– Building a solid financial foundation early on
– Making big purchases like a home easier in the future
– Setting yourself up for financial stability in the long term
Drawbacks of Saving in Your 20s
– Missing out on experiences and opportunities for personal growth
– Feeling trapped or stuck in a cycle of saving without enjoying life
– Strained relationships with friends and family due to financial limitations
Personal Finance and Emotional Fulfillment
While saving money is important for your future financial security, it’s crucial to find a balance between saving and living your life to the fullest. Money can buy material things, but it can’t buy happiness or precious moments with loved ones. It’s essential to prioritize your emotional well-being and mental health while making financial decisions.
Coping with Financial Restrictions and Living at Home
If you are feeling the pressure of saving for a big purchase like a house and struggling with living at home, it’s important to find ways to cope with the situation. Here are some tips:
– Focus on gratitude for the opportunity to save and make smart financial decisions
– Find affordable ways to enjoy life, such as exploring your local area or planning budget-friendly travel
– Communicate openly with your family about your feelings and work towards finding a balance between saving and living your life
Final Thoughts
Saving in your 20s can set you up for financial success in the future, but it’s important not to sacrifice your happiness and well-being in the process. Remember that life is about finding a balance between financial security and emotional fulfillment. It’s okay to indulge in experiences and adventures that bring you joy, even if it means deviating from a strict savings plan. Trust your instincts and prioritize what truly matters to you in the long run. You have the power to create a fulfilling life that aligns with both your financial goals and personal happiness. #FinancialWellness #LifeBalance #YouthfulLiving 🌟🌈
Gonna be honest; you’re in the wrong sub if you want life fulfillment and advice beyond finance.
A lot of people get turned away from this sub or don’t like it because it doesn’t rationalize what they want to do. Remember that this place is all about being as financially responsible as possible while leaving beneath your means and squeezing out as much as you can from every dollar you earn. And this sub is fantastic for explaining those things.
That being said; you should absolutely live it up a little. My parents were the same way; after myself and my siblings got good education and jobs and spent money and they realized we were well off, they relaxed and were supportive of it. My dad is even looking to buy a new truck, he’s never ever done that before.
Best of luck to ya
Sorry that that’s happening. Your parents probably have trouble balancing saving vs spending. At 23 it might be time to move out especially if you never left home for school or something. Your parents sound number based (don’t blame them) but you can still save a lot while spending some to live your life and be happier (experiences, not just material things). Also, consider a newer used car instead of a 2024 Prius as a compromise of sorts.
I think the key thing here is how much do you actually make?
If you’re making like 45k, then totally understandable — probably a smart decision to stay home for a little while and save..
If you’re a tech person making like $100k base plus $100k bonus, then you should probably just get your own apartment and take a vacation now and then.
If you’re in the second case, I would suggest putting X% of your money into savings of various forms (e.g. 40%), and then not feel guilty about how you spend the rest.
YMMV but I also find that there’s something very valuable about moving out. I’m also a similar age to you in the Bay Area, and felt when I got my own lease it really jumped started my independence and I felt much more like an adult, rather than a slightly older teenager.
I don’t think you need a new car though — you can get something in between. I drive a 2008 Honda with like 120k miles on it, and it works fine. I think often people buy cars because they feel like they should, but they’ve only convinced themselves they care about it. That’s just my two cents though.
You’re 23, man. Unless your friends come from significant generational wealth, the view you’re getting into their lifestyles is probably very curated.
Financially, make a plan.
Figure out how much you’ll need to retire using 4% disbursement per year as a guideline. Backtrack from there to see how much you need to put away into retirement accounts every year to reach that by your ideal retirement age (55? 60? 65?).
House goals should be separate from that – do you want to buy in 5 years? What does a 20% down payment look like for the area you want to buy in? Add 1/5 of that to the annual savings budget.
Do the same with your car purchase if you really want one. You don’t need to buy a new car to own a nice car. I drive a <80k mile 2016 Camry that I bought during COVID for only 16k. Because it’s a high trim level and I keep it clean, it feels like a much more expensive car.
Once you’ve gone down the list of all your savings goals, look at the remainder and figure out what your options are realistically. Can you actually afford rent, utilities, groceries, subscriptions, and entertainment without compromising those savings? If not, keep growing your income until you can.
A little bit, yes. The first half of your 20s, absolutely, enjoy your youth to max! You only have it once. Unless you need to save every dollar to accomplish a big goal like go to school, become independent from your family, etc. You only need to lockdown save for 10-15 years and you’ll be a millionaire. So choose when you want this time span to happen. You probably want a solid career in place to stay consistent in your savings.
How do you define “a large chunk” of your salary? Are we talking like 30%+ of gross? Have you considered moving to a lower COL place?
life is a one way ticket, it only goes forward, so you determine how you want to make it count. I would recommend balance out your pleasure, life quality and as long as you are financially responsible i don’t see why not.
You actually can’t always earn more money that’s sort of the point of saving and investing early. You’ll make much more money later by saving now, you have to determine the right balance, if you are saving at least 20% of your income then you can probably allow yourself some money for wants, just budget for the wants after retirement and after bills.
That being said cars are a huge trap, especially new, never buy a new car, shop used, and especially in an area with excellent mass transit options if it’s safe. Between gas, payment, insirance, repairs, its a huge expense thst sneaks up on you.
Personally…to me…
* imo, a new car in general is not worth it
* imo, rent (*in that area of the world*) is not worth it vs. living at home
* imo travel is definitely worth it, and much more limited / different once one has a child…so a bit now ish or never ish
But it’s *personal* finance so…up to you.
The purpose of financial health is for the stability to be able to focus on enjoying life imo. If I really wanted to maximize my returns, I’d just be eating ramen all day and night. But that wouldn’t be healthy or make me happy lol.
I think it’s about balance. Maybe getting a rough timeline on when you want things to happen might help you.
People act like your 20s are the only time in your life when you can have fun – if you take care of yourself, your 30s are your 20s but with more money, status, social connections, etc
I’m not hard pushing to live with your parents, but there’s never a more acceptable time to do that than as a young adult, and doing it can secure you passive income generating investments that will set you up for homeownership, many vacations, nicer lifestyle, early retirement, etc
Saving is smart because it lets you do the things you want in life. Plan what you really want, make the necessary sacrifices to save for it, and do it.
Save. But also save for yourself to have fun. You’re in the bay. If you can afford it, move out into SF it’s fucking great. Make some friends, travel, buy yourself a nice treat every once in a while. My grandfather passed in 2020 and the last thing he told me was that he regretted not spending what he made, you can’t take it with you.
So now I save what can and every once in a while buy a plane ticket (within reason) to a foreign country and spend 4 days there’s by myself or with my girlfriend. I’ve seen the world I’m 33 and I don’t make a ton, 155 after bonus in San Francisco, no debt. 8% into 401k with 7% employer match. You can do both
Go check out the book “Die with Zero” it will have answers to your questions. In regards to saving now, The author would say potentially yes, it is a waste. He makes the point to say there are only certain things you can do at certain stages in your life.
Practically speaking, your future career prospects and earning potential will determine whether it’s worth making sacrifices now (particularly experiences to save some money)
For me, I sacrificed my twenties working and saving. 19 – 27 is a bit of a blank spot in my mind because of what little I did besides stay on the straight and narrow with work. It came with mental health issues and a back surgery at 29 until I was able to make a career change. My wife and I bought our first home in 2017 and sold it last year to get into our current one at an affordable price. We had lots of equity because of large down payments and gains the first time around.
Had I not focused so much on money I could have taken better care of my health in those earlier years and had better experiences and probably still be fine financially.
I’d advise a healthy mix. I’m 39 and let me tell you around 30, everyone really moves away and gets married and is too busy to see you more than once or twice a year. I’m really grateful I had a ton of experiences in my 20s, although I was always broke… met a lot of friends dated a lot of people had all my sexual fantasies fulfilled, so nowadays , I have no sense urgency.
Did you go to college? Did you live at home during that time?
I can imagine dating while living at home is tough. I wouldn’t know.
I moved out at 17 to go to college and never looked back. I dated extensively. That I can tell you.
Living at home at 23 is a foreign idea. I would have been considered an abject failure. If I did that.
I’m not Asian. Son of a legal immigrant. If that helps.
At 23, you should be driving a piece of shit. Own it.
Bay area is expensive as hell. Consider moving somewhere cheaper, with young people, and jobs. Rent your own place. Have a few terrible relationships. Sleep of the roof of an abandoned blockbuster. Money’s important in the long term, but experiences aren’t money.
Wasting away living in the Bay Area. Most of those jobs you can find elsewhere and at a better cost of living. Best thing I ever did was move away from my family at 18. Also most of all moved out of CA to experience other places. I loved the diversity of all CA, but there are so much better places out there that you can save and live. Where you would be house broke living day to day if you are in CA let alone Bay area.
I saved a lot in my 20s. Loved with parents for 3 years. I’m in my 50s now and have $5M. I (and my family) live a nice lifestyle and don’t worry about money.