financial planning
4 questions
- Finance
How much should I save in my 20s?
Fidelity's benchmark is 1x your salary saved by age 30. Getting there requires saving at least 15% of gross income — including any employer match — as early as possible. The biggest advantage you have in your 20s is time: compounding works best over the longest horizon.
- Finance
What are fixed vs variable expenses?
Fixed expenses are the same every month — rent, car payment, loan minimums. Variable expenses change — groceries, gas, dining out. Budgeting requires handling them differently: lock in fixed costs first, then set averages for variable ones.
- Finance
What is the difference between saving and investing?
Saving means putting money in a safe, accessible account (like a savings account or CD) for short-term goals, with no risk of loss but low returns. Investing means buying assets like stocks or funds with the expectation of higher long-term growth, accepting the possibility that the value can fall.
- Finance
When should I update my budget?
Review your budget monthly to catch drift, and update it immediately when income, housing, debt, or family situation changes. A budget that doesn't reflect your actual life stops working.