ok so i am 16 and I'm getting a job soon. Im going to open a bank account and savings account then link the 2 . I'm going to transfer 10o/o of each paycheck to my savings account. and im thinking that wall im 16 and don't have bills to pay. that I should get the stuff i may want or need after i move out gathered and paid for so its ready to go. you no like kitchen and stuff like that. my question is what do you think is this a good idea?
Most Helpful Guy
This is what you should do:
10% - into savings for absolute emergencies only. This means - car stuck on the side of the road, or an emergency root canal, or some other REAL emergency.
40% - into savings (can be a separate savings account if that's easier) for things you'll need when you move out. Don't buy that stuff now - you'll just have to store it, it will lose value in the meantime, and it might not be what you actually need. Instead, save the MONEY, but don't DEPLOY that money until the actual need arises.
50% - spending money.
If you think you can save more than 40% for moving out, then do so. The more you save, the better things will be for you. But NEVER, EVER skip the 10% to your emergency savings - that should be the very first thing you do with every paycheck you get: "pay" your savings. You'll get used to doing that and you'll never miss the money - but when an unexpected bad day comes - AND THEY WILL - you'll have a financial buffer to help weather the storm.0
Most Helpful Girl
Excellent idea. I did the same, I still do it now.
It is my house fund to buy a place. It's always good to have extra money whether it's an unexpected bill or something you really want.
Be realistic. Give yourself enough money to enjoy yourself but if that money is automatically transferred on pay day you don't even factor that money into your month.0