Reply to How much "should" I be saving a month?

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[quote=Anonymous][quote=Anonymous]Working on a budget so DH and I can make some important decisions about childcare and what we can and cannot afford. We have high HHI (350Kish) but we also have a lot of debt (all student loan, low interest). What's a good rule of thumb (and something preferably not too complicated) for how much you should pay yourself first/save ideally a month?

I've heard 20% a month into savings is a good barometer and we're at that. Meaning, I've got a budget worked out where we pay down some student loan debt every month, plus have a nanny, plus put away about 24% of our take home income each month into savings (including retirement). Thoughts? Is this good? Bad? Basically trying to make sure we can afford a nanny without being financially irresponsible. [/quote]

This question can't really be answered by anyone other than you.  How stable is the income? What are the alternatives to having a nanny? How much savings do you have?  What types of savings?  College Savings?  Do you own a home?  Are you planning to buy a home?  What would you do in an emergency?  What is the interest rate on the student loans?  Could you pay the student loans plus all other expenses if you lost your job?  What percentage of your take home is discretionary spending?

We used to have about that in HHI and we saved about the same as you, and I wish we had saved more.  We are fine, but we have made decisions that ended up cutting income, and we had to go through some tighter (not tough, but tighter) times.  In retrospect, I wish we had gotten rid of all the debt and save a bigger cushion (i.e., at least $250k in non-retirement) when we had the chance.   Instead, we ended up realizing that we didn't have quite as good of an emergency fund as we wished after we had cut the income, thus squeezing much more to get to a comfortable place.[/quote]

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