Hi all,
I'm a 24 year old Technical Writer in the DC metro area earning $46,000/yr gross + benefits. I have a
surplus of cash ($25,000) sitting unused because I'm not sure how much I might need in the future, or I feel there's something I'll forget to account for. Frankly, I think I'm a little irrationally afraid of losing my comfy cash blanket, even though I spend somewhat frugally as if it doesn't exist.
Currently:- I have a paid-off car (2008 Mini Cooper with only 80k miles in good shape), though I take the metro to work almost every day.
- No debt
- Currently renting and saving ~40-45% of take-home income ($2,640/mo).
- I own a nice bed, dresser, computer, wardrobe, and laptop.
- I've been at my job for 9 months. It's not bad (especially since I only have an English BA and a CS minor), but government contracting isn't exactly my dream, and I feel like now's the time for exploring career options.
Future:- I plan to move closer to work and bike/walk commute in July.
- Over the next year or two, I hope to hone my writing, coding, and HTML skills in my spare time to enhance my appeal to employers.
- I want to move to a new city in the next year or two, though I'm not sure where yet. DC/Arlington is okay, but I want to try someplace new. I plan to spend the next year or two spending PTO visiting cities that appeal to me (Seattle, Austin, San Diego, Portland, Atlanta) to get a sense of them. This will also take a bit of money.
- Ideally, once I find a place I like, I'll apply online for jobs in the area, and move only once I have a job.
Question:I've read plenty of MMM, Random Walk, etc. to know and trust index investing. However, they only work if you put your money in and don't touch it for upwards of 10, 20, 30 years. I have more than enough for well over 6 months of living, but I can't help but think I should hold onto more than that, in case of a future down payment, job loss, totaled car, etc.
Should I keep ONLY 6 months' worth of expenses in cash, and put everything I save into Vanguard at the end of each month?
Should I keep 6 months + $5-10k to be extra safe?
Should I routinely keep a percentage of each month's savings in cash?
TL;DR How big a cash buffer should I have if I hope to move cross-country in the next 1-2 years?P.S. I'm open to advice on non-financial fronts about this plan as well, if anyone older and wiser wants to take pity on a confused young adult.