save three months of living expenses

Made a little progress, but I don’t want to save too much right now because I need to buy people Christmas gifts (that’s in a separate account).

Wow, I have a lot of expenses. I’m living paycheck to paycheck, and my monthly expenses are $4,500. $4,000 for bills and $500 for groceries. So I guess that means my goal is $13,500. So that means I’m 2.25% of the way there, with enough saved to last an entire 2 days.

Here’s my expenses per month (not including credit cards which should be paid off in a few months):
Mortgage 1979.85
HELOC 472
Water 75 (estimate)
Electric 80 (estimate)
Comcast 56.22
AT&T 68.16
T-Mobile 44.29
Geico 45.42
Suzuki 236
Student Loans 780
Server 90
Food 500 (flexible)

right now and if I don’t have to dip into the $1,000 EF, I can be done with this goal by 10/09…then I would work on saving six months of expenses.

Should add $650 this month. That’s about 15% of the goal.

I went to the link that junipurr said, and mine is around 4200. I am not too far off!

My Plan:

Savings account – One month expenses for emergencies (1400)- done!

Money Market account – Two months expenses for emergencies / joblessness. This is at a much higher rate of return than the account above. (2800)

CDs – I don’t have any yet. When I have filled the two slots above, I will start taking money into CDs for an even higher rate of return.

401(k) – I have 7% taken out weekly, but the company I work for doesn’t match anything, so I want to reduce the percentage and open a Roth IRA in addition to my 401(K)

I should be (need to be) really motivated to get completely out of debt to start saving. I might go even further than three months…maybe five or six. It will take me awhile to save it.

I also should try to up my percentage on my 401K. I can only afford 1 percent each pay right now. Tomorrow I find out about our benefits package at work and how much more they’ll be taking out pre tax. Right now it’s $82.16 a month. I hope it doesn’t go up too much. I’m also enrolled in the flex spending account (pre tax money taken out for prescriptions and such), which is nice but I had calculated way too much for this year, so next year won’t be as much. Maybe I’ll be able to raise my 401K only to 2 percent. :\

I just went to Bankrate and found a neat worksheet that helps you calculate how much you need for three months worth of living expenses. For us, including absolutely every possible bill, we will need 4251 minimum. We have about 1000 in emergency money right now. It’s a lot farther to go than I thought.

http://www.bankrate.com/dls/news/financial_literacy/Jan07_emergency_fund_worksheet_a1.asp

Well, I’m up to $400 in savings so far. Not much, really, but better than nothing!

By this chart, I don’t even have enough for ONE month of living expenses. It’s time to stop living paycheck-to-paycheck! (Maybe I should be getting bigger paychecks…)

My money is skin-tight, and until recently I’d never gotten around to actually saving any. But I’ve started feeling irresponsible for not having anything in savings at my age, and tired of occasionally having financial stress because of it. So I’ve been tucking back a bit of my paycheck for the last month, just seeing how it feels and how much I can actually afford to stash in my savings account. My monthly bills are about $800… not too terrible, although I’m about to move and they’ll go up some. So $3,000 sounds like a good savings cushion to work toward. It’ll definitely take a while, though!