# How Much Am I Putting in My Roth IRA This Year?

This week, I set myself the financial goal of figuring out how much I was going to put into my Roth IRA this year.

I started the Roth last year and contributed the max; that initial $5,500 has since grown to $6,241.43, which is a 13.48 percent gain.

So how much do I want to add this year?

The obvious answer is *$5,500,* because I am a completionist, but let’s look at the numbers first:

At the end of August, my savings account balance was $8,553.45. I did some income predictions through the end of the year, and if I continue my 15 percent savings rate I can assume that, by the end of December, I’ll have $11,500 in savings—plus that $3,000 checking account buffer which is serving as my cashflow and/or emergency fund.

I asked myself “what would I have to do to get that number to an even $12K,” and then I did the math and realized that, at a 15 percent savings rate, I need to earn $3,334 to save $500. (Wow.) It really makes you appreciate how little 15 percent is, even though it’s also, like, *the percentage they keep telling us to save if we want a secure financial future*.

I used to be saving 10 percent, and I bumped it up to 15 percent after reading *The Value of Debt in Building Wealth* and deciding to get as serious as I could about, you know, *building wealth*. But when I look at these numbers, wealth still seems really far away.

Anyway. Should I put $5,500 of that $11,500 into my Roth IRA? *The Value of Debt* would seem to suggest *no;* at this phase of my life, I should be accumulating liquid cash instead of focusing on retirement—especially because I already have $51,230.07 in my Roth and TIAA retirement accounts. (This number, incidentally, was $48,011.65 when I read *The Value of Debt* back in April.)

But if you do the exact-exact math, *The Value of Debt* wants me to put:

- 3x my monthly income into my checking account
- 3x into savings
- 9x into a separate savings account for “big life changes” (that’s the account you use for houses/weddings/babies/cross-country moves/medical expenses/etc.)
- 6x into retirement accounts

Which means I do need to add $5,500 to my Roth IRA.

That’ll mean I start 2018 with roughly $6,000 in savings, plus that $3,000 checking account buffer.

Is that enough? It’s more than a lot of people have saved, so I should feel lucky and/or grateful.

But it also reminds me that saving up a lot of money can be really, really hard.

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