Financial Adulting. Ashley Feinstein Gerstley

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      How Much Do I Need in My Walkaway Fund? Wait … What's a Walkaway Fund?

Dasha Kennedy urges all people, especially women, going into a relationship to have a walkaway fund saved in a bank account that only they have access to. For her, that means. “If I needed to pick up tomorrow and walk away, I have what I need for housing, basic necessities, and day-to-day expenses. That's a fund I will always keep.”

Dasha recommends having six months of expenses set aside for anything you'd spend if you were to walk away. And it makes sense if you think about how long it can take for things to get sorted out in a divorce, including assets to be distributed or alimony to be paid. You don't want to be waiting and putting things on credit cards or, worse, staying in a situation that's unhealthy or even harmful because of money. 99% of cases involving domestic violence include some form of financial abuse.¹ The walkaway fund could be your biggest form of financial activism yet.

      Note: This can overlap with your rainy-day fund, as long as only you have access to it.

      How much money would you like in your walkaway fund?

# of Months	×	Monthly Spend	=	Walkaway Fund
Example: 6 months	×	$3,000	=	$18,000
	×		=

      How Much Do I Need to Buy a Home?

      When we're saving up to buy a home we often focus mostly (if not only) on the down payment, which is typically 20% of the cost of the home. This is usually the largest cost, but if it's the only thing we're prepared to pay for, things are going to get financially stressful. We cover this in detail in Chapter 9 – get excited.

      How Much Money Do I Need to Retire?

As you can imagine, when it comes to retirement, there are a lot of variables that we won't know while planning. We talk a lot more about this in Chapter 7, including some important calculations, but for now, Lauren recommends using 15% of your income as a retirement savings target. So if you are earning $50,000, you'll want to be saving $7,500 per year toward retirement.

      How Much Do I Need to Move Out on My Own?

      In order to rent a place, you'll often be required to pay the first and last month's rent, as well as a security deposit (usually the size of one rent payment) – so that's three months’ rent. Depending on how you find the apartment, there may or may not be a fee you pay the broker. Don't forget to incorporate the cost of the move itself and any furniture you plan to buy. Make sure you add in the changes to your new utilities to your monthly spending as well.

      With any of these goals, you'll want to plan to have the money (or at least enough of the money) available when it's time to pay. So if you plan to move August 1st but have to pay the first, last, and security a month earlier, you'll want to have it saved by July 1st.

      How Much Do I Need to Start a Family?

^{The costs to start a family can vary widely, depending both on circumstance and preference. Fertility treatments like IVF may or may not be covered by your company's insurance and, if not covered, can create out-of-pocket costs of, on average, $23,000 per round.2,3}

      Once pregnant, the largest costs in the first few years are the health bills associated with giving birth (more on this in Chapter 10), getting set up with the baby gear (nursery, stroller, car seat, etc.), and then childcare. Childcare costs depend on where you are located, what childcare choices are available, and whether you have family available to help.

Add up the total one-time costs and the total ongoing costs. Once you have an estimate for the upfront cost, divide it by the number of years (or months) you estimate until you will need the money. This gets you to your goal contribution amount. For the ongoing costs Lauren recommends creating a budget based on your new child expenses and current income (I'll show you how soon). The total cost of the first year of a child's life generally can range from $16,000 to $50,000. That doesn't mean you need to have that amount saved in cash, but to be prepared with a combination of savings and lifestyle adjustments.

      With goals like this that seem more ambiguous it can sometimes feel silly to plan, but it's so much better to have something set aside than to wait until you have more information. You can and should adjust these goals as you learn more or things change, but don't wait to start!

      How Much Do I Need to Take Care of Family or Elder Dependents?

      For many, caring for parents or other chosen family is part of the financial plan. It might be a current reality or a reality in the future. This can influence where you choose to live (because you'll need more rooms), savings plans, retirement plans, and, really, all the plans.

      One of the hardest parts of making a plan is having a conversation with the individual(s) you may want to take care of. Understanding their wishes as well as what resources they have available, if any, will help tremendously in your planning.

      Much like other financial goals (like retirement), there are many things you won't know. Do your best to make an educated estimate and adjust as you have more information.

      How Much Do I Need to Start a Business?

      This depends so much on the business but doesn't have to be expensive. Are there any one-time costs to get set up? What costs are ongoing? For example, you might pay $200 to get your website set up initially but then the cost of maintenance is $10 per month. You'll want to incorporate both types of costs into your plan.

      How Much Do I Need to Take Time Off to Travel?

Cinneah El-Amin, a personal finance travel creator and the founder of Flynanced, walked me through her four-step process for mapping out the cost of travel.

      1 Start with flights. Cinneah searches Google flights and sets up an alert as soon as she has the idea for a trip.

      2 Think about accommodations. For group travel, Cinneah prefers Airbnb and loves Booking.com for smaller, more intimate trips because there is no prepayment and cancellation is free.

      3 Plan for trip “extras.” Cinneah then gets a quote for travel insurance (look to see what you already have covered if you're using credit cards) and checks whether there are any visa requirements, СКАЧАТЬ