Advice on Savings

1. How Much Should You Save?

Since you don’t have bills or major financial responsibilities:

50% Savings Rate: Aim to save at least 50% of your weekly income.
- On $150-$300 weekly, this would mean saving $75-$150 per week.
- At this rate, you could save $3,900-$7,800 per year!
If you spend less on wants (like hanging out), you can bump that to 60%-70% and grow your savings even faster.

2. Tips for Saving More

a. Pay Yourself First

Treat your savings like a bill you must pay. As soon as your paycheck comes in, transfer your target amount into a separate savings account.
This reduces the temptation to spend it.

b. Set a Spending Budget

Decide how much you’ll allow yourself to spend weekly for fun (e.g., $30). Once you hit that amount, don’t spend more.
Use cash or a prepaid card for discretionary spending to avoid dipping into savings.

c. Automate Your Savings

If your bank allows it, set up an automatic transfer from your checking account to savings every payday.

d. Save Windfalls

Scholarships refunds, birthday money, or tax refunds? Save at least 80% of these unexpected amounts.

e. Find Free or Cheap Fun

Look for free or low-cost ways to hang out with friends (movie nights at home, potlucks, or community events).

3. Improve Your Savings Account

0.02% interest is too low.
- Move your savings to a high-yield savings account (HYSA) like those from Ally Bank, Discover, or Marcus by Goldman Sachs.
- HYSAs currently offer interest rates around 4%, which will make your money grow faster.

4. Start Investing Small

Even if your income is limited, starting early can set you up for long-term success.

a. Invest in an ETF or Index Fund

Look into beginner-friendly investment platforms like Fidelity, Schwab, or Vanguard.
Start small with $50-$100 and invest in something like an S&P 500 index fund (e.g., SPY or VOO).

b. Open a Roth IRA

If you’re working and have earned income, consider opening a Roth IRA. Contributions grow tax-free and are perfect for long-term savings.

c. Stick to Low-Risk Investments

Since you’re just starting out, focus on safe, diversified investments rather than risky individual stocks.

5. Emergency Fund Goal

Build an emergency fund of $1,000-$2,000 to cover unexpected expenses (car repairs, phone replacement, etc.). Once you hit that goal, start investing more aggressively.

6. Build Income Long-Term

If your hours are capped, consider:

Freelancing or Side Hustles: Online tutoring, graphic design, or even gig work like delivery driving.
Part-Time Remote Jobs: Look for flexible jobs that fit your schedule.

Sample Plan with $150 Weekly Income

Save 50%: $75
Spend 40%: $60
Invest 10%: $15

This approach balances saving, spending, and investing without feeling deprived.