How does yours compare?
- It is important to have cash on hand for emergencies and different purposes.
- The average 30-something might have more cash than you think.
Having money in savings is important. First, you need to have a fully-fledged emergency fund, because you never know when life might throw you a curveball. Should you lose your job or get stuck with an expensive car or home repair, it could mean you have to incur expensive credit card debt if you do not have savings.
What’s more, you can have different goals you are saving for, such as buying a home or upgrading an existing one. And a savings account is a great place to store that cash.
Now you can finally have more cash savings on hand in your 30s than in your 20s. This is because your 30s may be when you end up earning more money at work and you finally managed to shake off the annoying debt you incurred in college.
But do you have a large amount of savings for your age? A small amount? Somewhere in between? If you are curious about it, read on.
What 30-something has in savings
The average cash savings balance among people in their 30s is $ 35,434, reports Personal Capital. Before we go any further, let’s talk for a second about averages.
When you take an average, it is possible for some very large numbers to pull up the final number. Therefore, it may be more helpful to know the median savings balance among those in their 30s. But unfortunately we only have the average to work with.
It is also noteworthy that although the average cash balance in savings for 30 people is $ 35,434, it does not necessarily represent everyone of the cash 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 they call “other” cash. It could be cash earmarked for a specific purpose – it’s hard to know.
Are you satisfied with your savings account balance?
It is 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 is important to determine what your savings balance means to you.
Let’s say you have $ 36,000 in your savings account (because hey, that’s a nice round number), and the purpose of your savings is to serve as your emergency fund. If you spend $ 6,000 a month on expenses, guess what? You are actually in very good condition as far as an emergency fund is concerned.
On the other hand, let’s say you have the same $ 36,000 in the bank, only you live in an expensive part of the country and spend $ 10,000 a month on expenses. In that case, you only have enough money to cover the cost of living for about three and a half months. If your goal is to have six months’ worth of value, you’re short.
Therefore, as much as it is ok to compare your savings with the average 30-something, you should finally evaluate your personal needs and strive to swallow enough money to buy yourself the financial security you deserve . It could be that you only have $ 18,000 in savings. But if you keep your cost of living at $ 3,000 a month, you’re in the same good shape as someone with $ 36,000 in savings who spend $ 6,000 a month.
In fact, comparing your savings with other people’s should actually be nothing more than an exercise in curiosity. You should not let it make you feel bad about yourself or dictate the goals you set.
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