1. Getting to mid-October
I still have another month before I start the job, and have just moved to a new apartment near the office. This has, of course, been expensive. On top of that, I will also be spending a few hundred dollars on adding to my business wardrobe, and am still purchasing things here and there for the apartment. I saved up a lot of cash before ending my summer job - cash which is not included in my finances below - and I've got about $1000 remaining to get me to mid-October. That should be enough.
2. Once I begin earning a steady paycheck, I have several priorities:
- I cant begin contributing to my 401k at work until after 60 days of employment - which means it is even more important for me to max out my Roth IRA contribution for 2010. To date, I've contributed about $1500, and so I plan to do everything I can to max this out.
- My car. Currently driving a 10 year old, basic Chevy, which has 120,000 miles on it, and several problems. I live and work downtown so driving isnt an issue to work - but I still will be doing some considerable driving - some driving to clients, around town (Detroit doesnt have much in the way of mass transit), and the biggest chunk of driving will be to see my girlfriend, who is still in school 90 miles away. I've put aside about $1,000 of that Ally money towards a new car, and want to ramp that savings up so that I can buy a new car whenever the next thing goes on the current car - if it makes it another year - awesome. I also have the advantage of being able to qualify for the employee discount of Ford and GM products due to family relations - so this will help.
- Finally, my remaining goal, in terms of the broad view for the short term, is beefing up my emergency fund, which currently stands at about $3,500. I have no set goal for this fund, but want to consistently contribute to it.
Your emergency fund should be 3-6 months worth of expenses. Once you get your overall budget figured up, you can then use a typical month's expenses to figure out how big your emergency fund should be.
ReplyDeleteThe emergency fund is a very important part of your overall financial strategy. Having that in place will help you through many financial difficulties without having to take on any debt. I know it was huge for me when my employer of 18 years closed it's doors and booted me out to the street. I had so many more options than others who were dependent on a steady pay check.