What To Do With Leftover Money When 23
I live in South Africa and I just started working this year. I would like to do what is the best thing for me to do with leftover money each month, instead of just spending it.
When I say leftover money I am talking of about per month. I am a coder and get around 00 per month. (converted from South African Rands to USD)
I would just like to learn how to use money better, but there are so many scams out there that googling for money advice is almost pointless. I was hoping this site might help.
I don't have any specific goals to be saving towards. I would just like to do something with the money to make it do something, rather than just lie in the bank and do nothing.
(1)1 Comments
Sorted by latest first Latest Oldest Best
First of all, Frank, bravo to you for looking at excess income and asking the question "How can I use this money well?" The fact that you are coming here and looking for advice from financially-minded people from around the world speaks well to your sincerity.
To answer your question directly, I would recommend that you seek out a decent bank and start a savings account (perhaps which offers a higher-interest rate CD or Money Market style account), and continue until you have a *decent emergency fund (more on the that below) set aside. Once you have a backup which can protect you from unforeseen expenses (medical, transportation, natural disasters, etc), which you do not touch except in those emergency situations, you can start to look at stocks and other accounts with a higher return (but also with more risk than a standard bank account).
However, all of that is in the future. At the present, from the information that you provide, I see a number of implicit problems in your question. A decent emergency fund, which I mentioned above, normally amounts to 3-6 months worth of your total expenses. According to your post, out of 00 income you spend 10 each month and are left with remaining. This means you spend 92% (10/00) of your take-home pay, and that your ideal emergency fund would be 30 on the low end, 60 on the safer end.
The problem is that with your savings rate of per month, it would take you 34 months (almost 3 years) to save up a small emergency fund, and over 5 1/2 years to save a more standard emergency fund. The likelihood that in the next 3-5 years that you will have at least one major expense is rather large, and when that comes it will wipe out your savings and drive you into debt.
The solution to this sort of problem takes 1 of 2 forms: either increase your income (not always within your control), or decrease your spending (usually within your ability to choose). By doing things such as reducing the number of times you eat out vs eating at home / bringing food from home, or adjusting your living situation (such as downgrading your apartment / getting a roommate), you can make the same take-home pay stretch farther, and save more of your income each month. By reviewing your spending and cutting back, you will be able to get an emergency fund created sooner, and be more insulated against problems as they arise in the future.
Terms of Use Privacy policy Contact About Cancellation policy © freshhoot.com2025 All Rights reserved.