How Much Money Should I Have Saved By 25?

By age 25, one might finish a degree or enter the workforce. It usually comes to mind how much money I should have saved by 25, so one must keep reading to figure out the correct answer.

Figuring out the specific answer to having money at a certain age will depend on a few factors that give an idea of statistics. People usually have an average income when they are first starting their careers. At an early age, it is essential to work on the savings rate and start saving early.

We will provide some general guidelines that one can follow to help at a specific limit of saving at any age. Spending a few years in the workforce will make you think seriously about saving money. However, saving is daunting when doing entry-level work with hefty student loan debt.

According to a survey, one must save at least 0.5X of their annual expenses by 25. It is usually a stable age when you have landed a job in the desired industry. Usually, people take the first step towards a brighter future. One can face much uncertainty at work but must start saving responsibly instead of stressing out.

We will guide you on making money, spending, and saving. It will benefit many if we have an accurate idea to figure out savings and balance within a normal range for your age. Although no magic number tells us how much cash one must save by the age of 25.

Savings at age 25

If anyone is trying to figure out how much savings one must have by 25, then you are on the right track. Financial independence is essential at this age, and one must keep track of income and debt.

Young adults should start saving 10% of their income to savings. If, after saving this amount, you still feel that there is some money left, you can increase the monthly savings amount. Financial advisors usually say to save 15 to 20 percent of the income for retirement, significant purchases, and emergencies.

Money offers retirement saving suggestions by some authentic sources one can see below:

Income Saving amount per annum
$40,000 $4,000
$60,000 $6,000
$90,000 $9,000
$120,000 $12,000

Roughly one must have saved about $20,000. According to the data bureau of statistics, the maiden salaries for full-time workers:

Weekly income, Yearly income, Age
$690 $35,880 20 to 24
$1,003 $52,156 25 to 34

However, 15 to 20 percent saving from the monthly salary is quite unrealistic for many 25 years old. Still, you have much time to save for life, but it’s wise to start saving as you feel like it. There is a need for an aggressive saving routine to achieve financial independence at this particular age.

The saving rate will increase as you start making more money. Try to spend at a slower pace, then the rate of income will increase. One can begin saving only through 5% or 10%; that seems a good start. Then these individuals can increase the percentage as time passes and income increases.

How to save money in 25?

Making smart financial choices will help you get a platform for long-term success. One must start saving early to avoid any credit card debt, pay off student loans, work to hit more significant goals, build emergency funds, or make enough money to get a mortgage on a home.

The habit of managing finance by 25 will help you to achieve your goals by 30 or beyond. Start from a bare minimum; even one can start from 5 percent while committing to oneself that one will increase the percentage over time.

  • Create a budget and stay stick to it
  • Good credit scores
  • Build emergency fund
  • Pay off credit cards before you go for student loans
  • Pay off debt
  • Develop good money habits
  • Budget for health insurance
  • Start saving for retirement

Create a budget and stay stick to it

Budget creation is an essential step towards saving as it will help to order and track your money

. It will inform you of all the transactions that happened to your bank, including how much money they added and how much you have used, and what to save accordingly.

Making your budget is minor, as many online apps and resources can help. Along with this, one must have the flexibility to deal with money when spending or income changes.

The most important thing after creating a budget is sticking to it, keeping track of your budget goals, and controlling spending. Refrain from overspending, which is hard to pay afterward, or if you can not afford it, focus on self-accountability.

Good Credit scores

Any adult who wants to save money must establish good credit scores to qualify for the best financial products like credit cards and a few loans. With a higher credit score, you can get the opportunity to receive better terms, so we will always suggest you clear your balance in time to get the benefits in the long run.

To qualify for a credit card, you need some credit history, which will also help you become an authorized user of a friend or family’s credit card. There is another option of a secure card that can work as a credit card, but you need to put down some deposit for it.

Some online options, too, can show your link with positive payment history. A few free features will depict your payment history positively if you pay your utility bills on time. Your habit of dealing with monthly payments timely will always help you to build good credit scores and get more monetary benefits.

After getting a credit card, one must use it regularly but mindfully to get good credit scores. Spend within your means and pay on time monthly with minimum charges, and we will suggest you pay it fully whenever possible.

Build emergency fund

The most appreciable step is to establish an emergency fund to cover unexpected expenses at an early age. These unexpected expenses could be a medical bill, car repairs, or a sudden need during any emergency.

The emergency fund is the amount one must keep in saving accounts; in fact, high-yield saving accounts are outside the stock market, as you must have quick access to them in time of need. One must save three months of living expenses as an emergency fund.

This specified money can help them during uncertain situations and can help them to avoid taking out a loan or carrying a balance on a credit card and save them from interest. I always prefer saving or online saving accounts that usually allow individuals to withdraw money six times a month without any penalty.

Putting three to six months of income in an emergency fund can make people deal with the state’s uncertain situations, calamities, pandemic outbreaks, or higher unemployment rates. According to financial advisors, one must focus on saving more after paying utility bills and necessary stuff. Any individual can start saving by taking little steps.

Pay off credit cards before you go for student loans

Before applying for any student loan at a higher interest rate, people usually have to pay high interest on credit card bills. So any individual must focus on paying credit card bills first and then deal with student loans.

Check out having federal loans, as they come with many advantages, including a forbearance period of interest effect. If there is no other debt, put the amount in the saving account you are spending on federal student loans, as there is no interest during the automatic forbearance period.

Pay off debt

If someone has credit card debts and student loans, there must be a priority to pay them off as soon as possible. Owning money as a lender will affect credit limits, resulting in lower credit points.

Irresponsibility towards paying off your debt can make you a high-risk borrower while reducing the chances of qualifying for other financial products. Carrying debt no longer affects credit scores and qualification chances but pays you much interest.

Make a precise payment plan and stick to it; this budget will make you clear your debts every month. Experts usually suggest paying off 20 percent of their income for debt repayment and saving purposes.

However, if you plan to clear your debt faster, you must invest more income. If you are using numerous cards, you can use the option of debt consolidation to help you to accounts you need to pay monthly with lower interest charges.

Develop good money habits

At early ages, especially in their 20s; one should learn to build good money habits while staying proactive towards their finances. Regularly check your account balance in different accounts and prefer no-fee checking accounts to avoid unnecessary monthly fees.

Go for the high-yield online savings accounts, spend within your means, and avoid exceeding unnecessary credit card debts that will lead you to pay high-interest charges. Optimizing credit cards comes with better spending habits.

Typically, credit cards offer rewards on gas, dining out, groceries, travel, ticketing, and much more. Get a simple cash-back card to earn the same tips on every purchase.

To save and earn rewards, one should be proactive and monitor even minor changes in credit history. Adopt techniques to save time and money in the long run, such as signing up for a credit monitoring service with early notice of malfunctioning and protecting personal information.

Budget for health insurance

If any individual is already on a parent’s health plan under the Affordable Care Act, it is not that appreciable as they need their health coverage before age 26. One must plan how to shop for an affordable healthcare plan, or one can apply to jobs offering healthcare insurance.

Without health insurance, a regular trip to the doctor can drain your entire savings, putting you in significant debt. For financial protection, one must not take healthcare insurance for granted and never go without health insurance coverage.

Start saving for retirement

It is imperative to start saving for retirement as early as possible, as it is always wise to put money aside for a prosperous future. One must make every effort to invest for your retirement; choose employers who match your contributions to a certain percentage to maximize savings.

While starting a job, choose an employer who may offer a retirement account such as 401k that will deposit a specific percentage on every paycheck every month. If your employer matches 25 to 50 percent of your contribution, that would be the same return on investment for the year.

Employer-sponsored retirement accounts help maximize savings. IRAs are a great way to set up a repeat transfer from every paycheck and secure the money.

Where should I be financially at 25?

Millions of Americans are worried about their future finances, so usually, they ask themselves, where should I be financially at 25? By knowing the answer, you can change the financial strategies that will work for you in the future.

A 25-year-old will have little money, especially if you have already taken student loans. In easy words, one should save half of their annual expenses. For instance, if someone spends $500,000 yearly, they must save around $250,000.

According to a recent survey, the average saving in a 25-year-old is less than $1,000 saved. But there is something better than nothing, so this figure is better for early ages. At the age of 25 years, people usually have a negative net worth, but the average value of that individual is around $23,000, even between loans and consumer debt.

Young people do invest and save money, but their liabilities are more significant than their assets around this age. It is bizarre to ask friends about their savings, but it would be much more helpful if we all were straight ahead about making money, spending, and saving amounts.

One must be clear that there is no magic number on how much money I should have saved by 23 or 25. Saving is a personal choice of any individual, and it depends on various factors, including what you make and spend and how much debt you carry.

Where one should be financially at 25?

It is always the right choice to start saving by 10 percent of your paycheck. However, one can increase the saving ratio if there is an increase in the salary or any bonus. To know where I should be financially at 25, one should know there is no boundary set, and the limit varies for everyone as per their circumstances.

Nonetheless, 25 is the right age to set a financial foundation for a prosperous and carefree future. It is always the right idea to open a separate high-interest saving account where you must restrict your usage for unnecessary things.

Individuals must save three to six months’ worth of salary or the value of six months’ expenses. Such savings assure confidence and assurance of doing things well during economic turndown or hard times without a job or earning resource.

To be in a stable economic position at 25, one must list their needs and prioritize monthly expenses. Aim to spend less than 30 percent of your earning towards your living or housing, and focus on the monthly cost of car insurance, student loan, and rent.

To be financially independent in the future, one must set some career and life goals and work to achieve them. They must know what they earn, spend, and invest. In the initial ages, when you do not have any stable job and do some gigs, there is no significant amount for saving.

Tricks that help to save money

  • Budgeting spreadsheet of your expense
  • Splitting paycheck to saving account
  • Track the spending
  • Make a budget rule
  • Set a target of saving
  • Stay consistent with your saving habits
  • Use budgeting apps
  • Improve investing habits
  • Long-term investment goals
  • Start saving for the future
  • Pay ‘myself first’ strategy

Budgeting spreadsheet

Making a budgeting spreadsheet at the start of your year or month will help you to map out your expenses. Control your spending habits and give yourself time before making any buying decision. Try to order only those things you feel you need, and do not put your hard-earned money into buying clutter.

Splitting paycheck to saving account

One other option is also there being a response towards the money; one should save a portion of one salary in a saving account. And make sure that you do not touch that amount for spending purposes; even you can split the paycheck, so the money directly goes to your saving account. You may seek the help of your employer in dividing your salary, which will make you instantly get cash in your saving account.

Track the spending

Keeping track of your spending will inform you of your monthly expenses and give you a foundation to cut costs short. It is challenging to write down everything you use and spend every time, but you can track significant expenses.

Make a budget rule

We will guide you with a budget rule that one must split the monthly income to save 20 percent, 50 percent for needs, and 30 percent for wants. Needs may include monthly bills of utilities and rent, which may consist of dining out, travel, and leisure.

Set a target for saving

If someone sets a target to reach saving; then you will work to achieve it. You will start saving money to get the target by reducing your social circle and hanging out. Minimise buying unnecessary stuff or shopping online, and reduce unnecessary expenses so you can move money into your savings accounts.

Stay consistent with your saving habits

There must be consistency in saving habits with a better idea of variable money. Adopt the strategy if it’s hard to project the same old stuff but stay consistent with the saving plan.

Use budgeting apps

Use some specific apps that keep track of your expenses. Such apps keep track of your accounts and record things automatically. Record and log every cost of the things you buy. As you receive your paycheck, save 20 percent immediately before doing anything else.

Improve investing habits

Learn a lot about investing and keep track of active spending. Learn when to make long-term spending, such as investing in a house or car, or short-term stuff, like a vacation.

Long-term investment goals

Suppose you have long-term goals, like buying a car or paying down your home or apartment. For such a purpose, you have to sacrifice a lot of happy hours with friends hanging out, parties, dining out, traveling, and many other things, but it is worth it.

Start saving for the future.

One must have a thoughtful approach to retirement saving and start at the very initial stage. Try to set more aside for retirement; however, people usually do not think about it in their 20s.

Pay ‘myself first’ strategy

Always focus on paying yourself first, which means one should save money when they pay for food or any utility bill. Make your mindset part of your budget, and never compromise on it.

How much money should I have saved by 21?

People even ask how much money I should have saved by 21; although it is a very early age to make some savings, one can still develop a saving habit at this age. One must learn money management at their initial ages to get the idea of investment at later ages.

By age, we realize that we must have started saving money early, which will help as a cushion when we get into a full-time job. As you enter the full-time workforce, many responsibilities include moving to your apartment.


It is essential to know how much money I should have saved by 25 and to reach the right goal, and it is crucial to make wise financial decisions to achieve future economic success. Work on achieving your financial goals towards a good credit score, debt-free while saving money for retirement and healthcare.

Usually, people ask, how much money should I have invested? The answer is straightforward 25 is the right age to start investing as it will grow your money over time. At 25, typically, graduates have an average salary, and it takes work to save as per their needs and wants.

Nonetheless, saving at the age of 25 is way essential as almost every individual has to achieve some high goals in the future. People who focus on keeping and investing will develop sound financial management habits.

Save a set amount on each paycheck, whether at the bare minimum. Still, in the end, it will provide a great cushion when you start independent life in the future or want to achieve some big task related to money use, including buying a home or automobile. In summary, 25 is the age to start taking your finances seriously.