How much money should an average person keep in a savings account?

Question

I'm talking about a regular, every day savings account - not including investments or 401k or any of that type of thing.

Answer 1

enough to cover 3 to 4 months of expenses

Answer 2

IT is recommended that one keep 6 months of income in some form of savings that one can use to keep on living if one runs on hard times. It is important to attain that 6 month income level over the first 2 years, so saving about 25% for that first 2 years. After that 6 month earnings buffer, one may want to ease off to about 15%, and do some investing, as distinct from just saving. When your investments are say 10% of the price of a home, it is likely that you will be thinking of that, but do nto dip into your 6 months of income stash. You should expect that your ability to add to savings or investments may be limited until you have paid off your mortgage. For that reason you may want to avoid buying the most house you can get financing for. When you have a house and mortgage, your need to retain your 6 month buffer is at its greatest, to protect your investment. You have to avoid big purchases like a new car until you can buy it without touching that buffer. Remember that buffer is not savings to buy, it is savings for unexpected difficulties. When I say without touching your buffer, I mean you are better advised to go for a used car and avoid financing, because financing removes your buffer, You need to treat all financing as negative savings, but more negative than simple savings. How much savings would you need if you run up a 15,000 credit card debt? 20,000 plus 6 months of earnings. If you have a $120,000 mortgage, you need only your 6 months earnings as a buffer, 6 months to make a forced sale of your home if necessary. But do not be lulled into having consumer credit on top of mortgage and have only that 6 months buffer. You need 6 months on top of the ability to pay off those consumer credit debts.

Answer 3

None.

Your money will do more for you in a good investment. Just make sure you can sell your shares and get the money reasonably quickly, in case you ever lose your job. For the sudden expenses, like car repairs, use a credit card.

Answer 4

Always keep about 3 months worth of expenses in a cash or money market account in order to cover emergencies.

Answer 5

3-6k, if you don't have a home or car.
5-10k if you have car.
10-20k if you have a average home mortgage.

Sometimes unfortunate things happen in sequence, eg: lost job followed by car breakdown and broken house windows.
Just prepare for the worst, and only you know exactly how much.

Answer 6

depends how old you are maybe if your in your 30s your probably working on financing a new car or house so you wont have any money but 5 thousand is good for backup

Answer 7

1000-2000

Answer 8

A year of salary.

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Answer 9

At least three months of housing payments and regular essentials

Answer 10

I've heard you should strive to save 10% of your salary.
Check out www.bankrate.com to see what sorts of accounts in your state will give you a higher yield (APR).