I’m wondering how to “catch up” for time wasted mismanaging my finances while in active addiction.
Long story short I was addicted to substances from 15-22, got sober & have maintained sobriety for 8 years but switched addictions to gambling at 24. I quit gambling 8 months ago & have been aggressively saving since then. I currently live back at home and am in a privileged position that I can capitalize on & make up for my past missteps (which most ppl aren’t so lucky to have that “2nd chance”)
I wasted my 20’s and never contributed to 401(k) , in fact I just started doing so last pay period. My company matches 4%, so I started with what the company matches as a jumping off point. I will be making safe long-term investments with ETF’s (S&P 500).
Additionally, I opened a No-Penalty CD at Marcus (APY 4.70%) with $10K from the money saved after I quit gambling. Alongside a HYS at 4.5% that I opened with $1,000 and will be contributing $1,050/mthly. I opened these accts last month.
I have no debt, credit score is 670 & net pay is just a bit under $3K after taxes, benefits & all contributions. I am on a 5 year plan to save to purchase a home at 35 in a LCOL area. What else can I be doing to make up for botching my 20’s?
I contribute a little over $1,000/mth to my mother (pretty much all of which ends up going to household bills, this includes rent) NerdWallet tracks my spending at about $1550/mth. I haven’t done shit this last year but work so I’ve been saving on avg $1,450/mth since I started this journey 8 mths ago.
I was thinking about contributing 20% into 401(k) for the next 5 years which would put me at about $60K. I would still be able to save roughly 800/mth, so just under $10k annually which in theory would leave me with $65K (including the $15k I currently have in CD/savings) for a home purchase in 5 years (not including) what I contribute to 401(k). Is that foolish? Am I not thinking realistically? Any advice is greatly appreciated! Thanks. 🙏🏽
Edit: I should also mention I am single w/ no kids. Additionally I have about $3K in HSA.
Submitted January 26, 2024 at 06:21PM by rawtendenciez https://ift.tt/qGjk8xS
