26 years old and making $24/hr, contribute 6% pretax to a 401k (3% matched), biweekly take-home around $1400.
After starting my full time job last year, I’ve out money into my Roth IRA every month. Ideally, I can max it yearly. I still have $1050 that I can put in by April 15 for 2023.
I don’t have a proper emergency fund. Should I scrape together what I have in different bank accounts to max it?
Account 1: credit union, about $500 in checking/savings. Mostly used for Zelle. No apparent account min or monthly fees according to their website.
Account 2: Chase, about $415 in checking/savings, but $5 service fee if the savings account goes under $300 for even a day (sucks).
Account 3: online HYSA, about $1118 available, but over $900 is “earmarked” in different buckets for car insurance, discretional spending, and vacation savings. I could pull from the latter two buckets and other available savings for up to $740. No account fees.
My concern is that maxing the IRA will wipe my savings. I typically have more in my savings and save $300-400 each month, but recently got hit with owing money on my tax return (already paid). I have about $125 on my credit card right now and always pay off the balance.
Should I prioritize maxing my IRA contributions for last year, or build up an emergency fund first?
original posted by btkwh to r/personalfinance on Sat, 06 Apr 2024 16:02:08 GMT.