I received my quarterly 401(k) report today. It had me thinking again and I've been researching for a few hours now.

Here's the stats. I make 15/hr. Hours vary but  I grossed $28,500 this year. I'm 29. I've blown my checks like an irresponsible bachelor for the past 5 years (I know). I have a 401 that was started in 2011. It is at 11,900 as of a few weeks ago. I invest 5% with a company match 4%. My annualized rate of return was 11.8% since the start but 8.2% year to date.

My bills. Rent a room from a friend $250/mth. Cell $45. Insurance (renters/life/bikes/car full coverage) 170-190/mth. Zero debt, no loans.

I am trying to figure out what a "good" plan is. I have $500 in my checking account. $700 in a ring fund (200/check saving for $5k proposal next year) and 100 in savings. I have spent on guns and motorcycles (I know) and realize it's time to grow up. Apparently 12 months salary in savings is a typical safety net responsible people aim for?

I'm planning long term. Im selling one of my bikes for $10-12k which I'll buy a low mile economy car (chevy cruze eco) with. Sell my current car for $5-6k and put that in savings. Where should I put money? I am shooting for $3-400/month savings account, and $400/month in the ring account, and add % to my 401k. Company match is limited to 4% where it's at.

What are some financial recommendations? Please go easy on me, I know I spend like a window licker but that's what I'm addressing. Should I bump up my contribution %, or focus on diligently saving in a savings account? I'm trying to figure what I can plan on when I'm 60 for financial security.

I hear you there. $5k is a goal to free up wiggle room. I'd rather have more than not, and I know a local jeweler who priced a ring for a friend I brought in and it rapidly went from $9k to $65, so I'd anticipate somewhere $3k anyways.

Your 401k yearly max contribution is 17.5k and you are contributing $1,425 a year (28.5k x 0.05) with your current salary.  At your income bracket, I wouldn't worry too much about trying to bring down your taxable income that much for tax purposes because you are at the lower end of the bracket (not trying to offend, just stating a fact).

So, if you are truly going to end up with around 15k in cash, stick it in the bank and for gods sakes DON'T TOUCH IT.  That is your 6 month emergency fund.  Next you need to work on bringing your expenses down to a minimum.  I wouldn't change your 401k contribution until you have 9-12 months earnings in that account.

Once you have a budget and your 9-12 month emergency funds in place, you can look at bumping up your contribution.  I would suggest bumping it up to 10% and seeing how that's goes.  My % goes up every year when I get a raise, if I get a 4% raise all 4% goes into my 401k, I'm getting pretty close to the max contribution now and I'm only 34.  You also should open a Roth IRA and contribute any bonus money or tax refunds or any other windfalls into this account, you can put up to 5500 a year in here and it's tax free to pull the money out when your retire.

You just have to get disciplined about it.  I didn't get serious about things until I was 30.  Admittedly when I was 30 I was in a better financial situation than you, but its all about perspective.  The same principles apply whether you make 20k or 200k

I would also say that you should be taking advantage of any and all tax credits possible because you should qualify for basically everything.  You aren't doing yourself any favors if you leave anything on the table, the government isn't going to do anything useful with it, I can assure you of that.  When you get to the higher end brackets, they take 90% of deductions and credits away and just stick their hand out and tell you to pay up.

Take a look at Blue Nile for a ring.  You can design your own and spend as much or as little as you want.  $5k is absolutely insane in my opinion, especially for your income.

Please don't spend 5k on a ring.

For perspective i make low 6 figures and i spent less than 1000 on a ring. A lot less.

+1 http://www.amazon.com/Tungsten-Carbide-Wedding-Brushed-center/dp/B008KUYHWO?

  you spend 12 hours labor  per month on Insurance ?

I quality cut 3/4 carat diamond and mount should set you back around $2700 and will make all of her friends think their 1ct diamond from jared is shit and looks smaller.

First, congratulations on being debt free.  That's something most people struggle with.
Now I'm going to get rough on you, but don't get me wrong, I'm just saying what needs to be said, not trying to be mean.

You are spending WAY too much on a ring.
I make considerably more and spent considerably less - no, I was not just being cheap.  

Anyway.... other topics:
*Target saving 15% of your income for retirement.  That's a general rule.  You don't have to get there today, work yourself up to it, have a plan to get there.  Write your plan down and force yourself to stick with it.

*Why are you paying for life insurance?  What type of insurance? (Whole?  Term?)  Who are you insuring?  Apparently you don't have anyone depending on you earning money at this point.  At most you should be concerned with burial costs, but you should have enough in a cash emergency fund to cover that.

*What are you driving now?  How much driving do you do?  Is it really going to be more economical to sell your vehicle and buy another?  You say that you are selling *one of your bikes*.  That means you still have at least one more.  What kind of fuel economy does it get?  If you are going to justify keeping it I think it should be used as a commuter vehicle at least 50% of the time.  I doubt selling your current vehicle that is worth $5-6k to buy another newer vehicle that will just depreciate heavily would be the correct choice, but it's possible. Why are you keeping full coverage on a $5-6 car?  How much is the car's insurance alone?

*Your emergency fund is not the same as your general savings account that you tap whenever you are making discretionary purchases.  The amount of your emergency fund can vary greatly.  How much is the deductible on that insurance policy for the bike or car?  I doubt the $100 in your savings will cover it if something happened.  My opinion is that as a non-parent and non-homeowner you should target about 3 months of income in an emergency fund.  Other life factors will increase that amount.  Start building this as a priority now.  What good will that ring do you if you lose your job or have an accident that keeps you from working?  Once you get a minimum of $1,000 in the account, start splitting up what you were putting away to other goals like the ring and a regular savings account, but keep building the emergency fund to an amount you can live on at the same time.

*You need a real savings account.  One that you will put money in to on a regular basis and save up money for a large purchase.  If you like buying guns, that's fine.  Just put $20 a check or whatever in to the savings account and when you have the money for the purchase go for it.  Just set an automatic transfer from your checking on payday to go to this account for a minimum amount.  If you find you have excess money at the end of the month and want to get to your goal quicker it's fine to send that money over also.