4 Tips for Saving Money at Age 30

Retirement may seem far away when you’re not yet 30, but it’s never too early to start saving for your future.

If you want to retire by age 67, experts at retirement-plan provider Fidelity Investments suggest having one times your income — or the equivalent of your annual salary — saved by the time you turn 30.

For example, if you earn $40,508 per year (the average yearly earnings of a 20- to 34-year-old according to Q2 2020 data from the Bureau of Labor Statistics), this means having $40,508 saved by your 30th birthday.

While this guideline may seem daunting at first, CNBC Select has some advice to get started saving.

If you are in your 20s, or even if you reached 30 and don’t have the equivalent of your salary stockpiled somewhere, the below four tips can help you begin your saving journey.

1. Automate your savings

2. Open a high-yield savings account

Ally Bank Online Savings Account

On Ally Bank’s secure site

  • Annual Percentage Yield (APY)

  • Minimum balance

  • Monthly fee

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle*

  • Excessive transactions fee

  • Overdraft fees

  • Offer checking account?

  • Offer ATM card?

    Yes, if have an Ally checking account

*The 6/statement cycle withdrawal limit is waived during the coronavirus outbreak under Regulation D

Pros

  • Strong annual percentage yield on all balance tiers
  • No minimum balance
  • No monthly fees
  • Up to 6 free withdrawals or transfers per statement cycle*
  • Option to add a checking account
  • ATM access if you have a checking account

Cons

  • $10 fee per transaction if you make more than 6 in a statement cycle
  • $25 overdraft fee

And if you don’t need a checking account, but would like an ATM card with easy access to your cash, Synchrony Bank may be a good choice.

Synchrony Bank High Yield Savings

Synchrony Bank High Yield Savings

Information about the Synchrony Bank High Yield Savings has been collected independently by CNBC and has not been reviewed or provided by the bank prior to publication. Synchrony Bank is a Member FDIC.

  • Annual Percentage Yield (APY)

  • Minimum balance

  • Monthly fee

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle*

  • Excessive transactions fee

    None, but may result in account closure

  • Overdraft fees

  • Offer checking account?

  • Offer ATM card?

*The 6/statement cycle withdrawal limit is waived during the coronavirus outbreak under Regulation D

Pros

  • Strong APY
  • No minimum balance
  • No monthly fees
  • Up to 6 free withdrawals or transfers per statement cycle*
  • Easy ATM access
  • 1 physical branch (in Bridgewater, New Jersey)

Cons

  • Account could close if you make more than 6 transactions in a statement cycle
  • No option to add a checking account

Remember that any windfalls of cash are perfect opportunities to add more to your savings. Consider depositing all or a portion of things like yearly bonuses and tax returns. They may seem small amounts of money, but they certainly add up over time.

3. Keep your expenses low

So you have enough cash to deposit into your high-yield savings account, it’s important to maintain low cash outflow.

Start by creating a budget to see where every dollar of your money goes each month. You may realize some easy expenses to cut back on, like canceling any unused subscriptions, memberships or streaming services. If you’re starting to ease out of working remotely and are returning to the office, consider how much your commute and eating out can cost you.

And as you progress in your career and your income increases, continue to live on your older budget so that you save the difference in earnings.

4. Invest in your 401(k)

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the CNBC Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.

— to www.cnbc.com

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