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Old 02-16-2010, 08:15 AM
 
Location: Piedmont NC
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Is there such a thing as too much in savings?

Encouraging young people to save, while young, helps instill the habit. I do it painlessly, by setting it up through my employer, and the bank, and it comes out of my paycheck.

I went to HS with a very smart young woman, who saved 1/2 of everything she earned, and by the time she was in her mid-30s, she had a retirement account that let her retire, and enjoy traveling and volunteering.
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Old 02-17-2010, 12:26 PM
 
Location: Northern Virginia
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I'm 23 (well, for another month!), but I'm married, so my situation is a little different. Combined, we have about $50k in cash and $30k in 401ks (roths). No mortgage, no car payments, a few thousand in student loans. (The cash is my "down payment" savings fund). I also have $15k sitting in an "emergency fund", which would pay rent/utilities/groceries for 6 months if my husband and I got laid off at the same time and didn't get unemployment (worst case scenario). We're very blessed financially, because my parents paid for my education and his parents paid a large part of his. We graduated with a total of only $20k in student loans between us.

When I graduated from college, I had just enough money to get me from graduation day to the first day of my job. I started work the end of July (we graduated in May), with $100 in my bank account. 2 1/2 years later, the money accumulated pretty painlessly.

My advice would be to focus on school. If paying money for an education is going to get you a better career down the road, don't be afraid to take out student loans for it. That's the one place I have no problems taking on debt (so long as there is a good career on the other side). I got lucky and the graduate program I am in now is weekend classes, so I can still work full time during the week to pay for it.
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Old 02-18-2010, 09:36 AM
 
11 posts, read 51,630 times
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Quote:
Originally Posted by RDSLOTS View Post
Is there such a thing as too much in savings?

Encouraging young people to save, while young, helps instill the habit. I do it painlessly, by setting it up through my employer, and the bank, and it comes out of my paycheck.

I went to HS with a very smart young woman, who saved 1/2 of everything she earned, and by the time she was in her mid-30s, she had a retirement account that let her retire, and enjoy traveling and volunteering.
I think it's great to save up as much as possible, if you do it with some end goal in mind, and you are reasonable about it. No one should give up necessities in order to save up their money, but there are tons of expenses that are really a waste, like sodas, movies, buying books instead of going to the library, etc.

The only problem comes when people get too attached to the idea of saving money that they can never spend any of it when the time comes. But I think what your friend did was brilliant, and a lot of other people could do the same if they started off early enough and got into the habit of saving and spending wisely. All of the rich people I have ever known use coupons; I think the two go hand in hand.
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