How Much Money Should I Have in Savings as a 25-Year-Old Living in Maine?
I can’t be the only one that has Googled the generic question, “how much money should I have in my savings account?” just to see if I’m on the right track.
The answer obviously changes based on the individual and their circumstances but it’s nice to know what the general consensus is.
My bank account fluctuates and as a recent college graduate, I’m still trying to get my footing and bearing in this world, my finances, and my career.
Based on general expenses living in Maine, how much money should I have?
How Much Money Should I Have in my Savings Account?
I did a deeper Google dive than normal to pull this together and while this will vary case-by-case and even most websites have different answers, this is a generic estimate for how much money I should have saved at my age.
According to Bankrate, Fidelity Investments recommends that you save at least 1x your salary by your 30th birthday. For the case of this article, I’m not putting into account a retirement fund but more about what I should have as an emergency fund and what cushion I should have in my account for financial safety.
Not to be a pessimist but I’m not overly concerned about my retirement situation right now with the world burning down around me and the collapse of society on the horizon.
Standard financial advice says you should aim for three-six months’ worth of essential expenses which include housing, transportation, food, healthcare, insurance, and utilities/extras. So, an easy formula for figuring out how much you should have saved is:
Your monthly expenses x 3-6 = recommended savings
In order to figure that one out for an average estimate, we need to talk about the cost of living in Maine.
The Cost of Living in Maine
I’m not going to use my personal numbers here because ya’ll don’t need to know me THAT well but rather I’ll use average expenses based on some Google research.
UpNest shares some expense information about Maine residents’ cost of living stating that Maine has the third-highest grocery bills in the country with the average single person spending $4,115 on groceries annually. Our average healthcare is about $5,860 annually, car insurance is around $862, and the rent averages out to around $900 with places like Portland being $1,000+ but more rural areas being as low as $600.
So, let’s figure out this savings account thing.
If we break down those numbers into monthly costs, this is what we’re looking at:
- $900/month for housing
- $400/month for groceries
- $488/month on healthcare
- $80/month on car insurance
- $200/month on a car payment
- $500 for extras (this will vary drastically per person)
This brings us to around $2,586 per month on expenses. Let’s use our little savings formula from earlier.
$2,586 x 3 = $7,704
$2,586 x 6 = $15,516
Based on these monthly expenses, I should have between $7,704-$15,516 in my savings account to be financially safe here in Maine.
I’m not going to tell you whether or not I’m on the right track but this is… interesting.