Color of Money: How much should you be saving?

Michelle Singletary on

But relax, you're doing just fine.

Q: I'm going to be 30 next year, and I'm thinking about different financial things that I want to do. These include saving 15 percent for retirement (and continuing to tithe); buying a house; buying rental properties; traveling and doing fun things; buying a car; and maybe even buying a new purse. I don't see how I can afford everything, and it makes me feel anxious and overwhelmed. Do you have any advice for tackling all of these things and making a plan?

A: You are right you can't do it all. So prioritize what you need to do with the money you have. Make sure the major stuff is funded first -- retirement, emergency account, etc. If you've got money left over, put it toward your wants.

Q: What is the impact on my credit score of canceling a longstanding credit card? I've had it for more than 30 years and it probably accounts for 40 percent of the credit available to me, but I haven't really used it for years. I have three other credit cards, and I really only use two, and I pay off the balance on each every month. Of these three, I've had two for around 25 years. Will my score decrease when I cancel the card? I'm not planning on taking out any loans any time soon; we just refinanced our mortgage last year.

A: If you close the 30-year-old account, it won't immediately disappear if at all. Positive information can stay on your credit report for up to 10 years. Since you pay off the cards you do use every month, you shouldn't see a dip in your score. And if you do, it will be minor and bounce right back.

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Kick the old card to the curb.


Readers can write to Michelle Singletary c/o The Washington Post, 1301 K St., N.W., Washington, D.C. 20071. Her email address is Follow her on Twitter (@SingletaryM) or Facebook ( Comments and questions are welcome, but due to the volume of mail, personal responses may not be possible. Please also note comments or questions may be used in a future column, with the writer's name, unless a specific request to do otherwise is indicated.

(c) 2018, Washington Post Writers Group



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