26 yrs old make 55k - how much should i have in the bank?

Where do you live? That might be the issue

I live in canada and pay a lot in taxes, but still, i just feel like im careful with my money. I don't waste it, etc, and can't really get ahead for some reason

Let me rephrase: how much is your rent?

And no one spends 55k on necessities so you definitely have more than a few hundred left over every month, you've just decided to spend it on things. Nothing wrong with that, that's what money is for. But don't call yourself poor or unable to save money.

well it's not rent, because i bought a house. the house is small and was reasonably priced.

Every time i get a thousand dollars saved up it seems like i have to pay property taxes or something.

Do you spend it on ladies?

6 months expenses.

Make a list and determine where ALL your money is going and all non-necessities need to be cut off until you have that reserve built up.

According to cnn.money.com, median net worth for your age is $8,525 and median net worth for your income is $168,500.

working poor? wrote:

well it's not rent, because i bought a house. the house is small and was reasonably priced.

Every time i get a thousand dollars saved up it seems like i have to pay property taxes or something.

Why did you buy a house only making 55k/year???

Is this a common thing? How much are the monthly payments?

Dude, home ownership is a part of the Amerikkkan dream!

It sounds like your house might be a little more than you can afford.

Not necessarily - I only make 29K/year, and qualify for up to 150K in mortgage at a reputable credit union. Depending on where you live (I seem to remember midwest cities like Indy, Detroit, and the like), you can get decent-sized houses priced in the 50-75K range.

To the OP - like the others have said, track your purchases for a few months, see where your money is actually going. I'm banking about 400 per paycheck into savings, but I also don't have a mortgage.

Blathering Blatherskyte wrote:

Not necessarily - I only make 29K/year, and qualify for up to 150K in mortgage at a reputable credit union.

Omg I would never in my life take a mortgage that large at that little salary (especially a salary so low that it indicates that my job is always in jeopardy). Is this really normal practice?

Keep in mind the difference between what you can QUALIFY for, and what you should DO.

For instance, say you're married, and your spouse has shyte for credit. Even if you make 29K, and they're making 130K, you may get more favorable rates and/or qualify for more than you could together, or they could on their own. So, in that case, going max on your qualify might make sense, because you will absolutely be able to cover it and have money left over.

Now, if you're flying solo, then you should never go at the max range of your qualification. Personally, I would never go over about 60% of qualification, because I want to be able to take vacations and have money to play around with.

Thanks for the replies so far. The mortgage costs about $900 per month. On top of that i pay property taxes of about $1200 every 6 months.

So whenever i start to finally gather some money, I have to give it to the tax man.

As of now, I am saving about $300 every two weeks... Maybe I'm just house poor, and not completely poor? I just thought i would have more in the bank by now

900 per month x 12 = 10,800

+1200 PT = 12,000

groceries, lets say $50 per week brings you 2,500 more in the hole, 14,500

bils, lets say 200 per month (assuming EVERYTHING), that's another 2400, so now you're at around 17,000

Taxes i'm guessing are around 25% to be fair, so that's 14,000 more per year, 31,000

I assume you have a car, so that can be up to 200 per month, lets say 2400 more, 33,400

Lets say you go out to the bars or restaurant every week, twice a week, that's including dates and whatever, so 40 dollars x 50 = 2000 more. 35,400

Lets tack the gas average on there too of $1500 per year, about 37,000

One last thing, assuming you have college loans and you're paying the minimum, usually around 150 per month, that's another 1800. so 38,800

Let's round it up to 40,000 just for shits and gigs, because people tend to buy shit every once in a while when it's necessary.

So you should have around 15,000 left over, or about 1250 per month, saved up in the bank. Find those loose ends that are cutting your savings down by half. You should save about 600 per month COMFORTABLY. Some of the things listed probably don't apply to you, but banks always have leaks so that's understandable. You should still aim to be close to this, if not well above it.

You really need to come up with a realistic budget after tracking your spending for a month or two. $900/mo should leave you with plenty to save (even after taxes and other bills/expenses). There is a leak somewhere, you just need to take an objective eye to where your money is going.

working poor? wrote:

Thanks for the replies so far. The mortgage costs about $900 per month. On top of that i pay property taxes of about $1200 every 6 months.

So whenever i start to finally gather some money, I have to give it to the tax man.

As of now, I am saving about $300 every two weeks... Maybe I'm just house poor, and not completely poor? I just thought i would have more in the bank by now

At 55k gross you're probably taking home what, $35-40k?

$300 every two weeks is $7800 a year. If you're really saving 20% of your take home, that's solid. It just takes a while to build up a big pile.

What do you mean by "bank"? Cash savings or net worth? If you are building equity in your house and throwing a decent amount of money at retirement funds then there is no shame in not building a huge cash reserve.

I make 50k per year and my cash savings is not building at all. Then again, after paying ~$1050 per month in rent I am throwing 30% into my 401k and maxing out my Roth IRA every year so I have an acceptable excuse.

I don't know how much you should have saved, cash or net, but to give you a comparison at age 27 I had about 90k net worth and about 8k of that money was a result of investments in my name when I was a child by my parents and grandparents in stocks and mutual funds.

figure you'll be making more as you get older, and you should save more. your home equity should grow (unless you live in Vancouver), and in 10yrs you should be able to save $1k/month

You are way ahead of most.