Money Mindset

Disclosure: This post contains affiliate links. If you purchase through my links I may earn a small commission at no extra cost to you.

Most women who feel behind financially aren’t “bad” with money, they’re working with misinformation. Think of it like an operating system that needs an update.

The money advice most of us received growing up came from people who were also working with misinformation, operating on the wrong system. It gets passed down like a family recipe, unquestioned.

These myths about money are so common that most people never stop to question whether they’re actually true.

This post covers five of the most damaging money myths, where they come from, and what to believe instead.

I’ve personally believed several of these myself and can trace specific financial decisions back to them. Working through limiting beliefs around money is a key to unlocking better decisions and faster growth.

MYTH 1: “Save What’s Left Over”

This common belief goes something like this- pay your bills, spend on what you need, and save whatever is left at the end of the month.

This thought process does not lead to great financial results because there is never anything left over. Spending expands to fill available income every single time. Waiting to save means never saving.

Here’s what actually works and the new belief to prioritize- pay yourself first, automatically, before you see the money. Savings (or other financial priorities, like debt payoff, investing) should be the first line item, not the last.

I admittedly have operated with the “save what’s left” mentality most of my adult life. Once I started to put my financial priorities first, I saw instant results. 

I will add that if you are a high-earner or you are in a situation where your fixed expenses are low, you will see results from changing this mindset almost overnight. 

The money is already there- it just needs to be directed to the right place.

My emergency fund contributions are deposited into a high yield savings account every paycheck, before I even see the money. I never have to make a decision about paying myself first, because the process is automated.

The money you never see is the money you actually save. Read more about the 3-account system I use to automate my finances.

MYTH 2: “All Debt Is Bad”

Debt is a four-letter (swear) word for some people. Here’s the myth- debt is shameful and should be avoided at all costs.

This belief creates so much shame around debt that people avoid looking at their numbers altogether. 

Because honestly- if you believe debt should be avoided but you have debt, how do you reconcile that? Most people choose not to but you can’t fix what you won’t face.

Here’s the truth- high interest consumer debt is what undoes financial progress and what should be avoided. 

A mortgage, a low interest car loan, or student debt that led to a high earning career is a different conversation entirely. Not all debt carries the same weight or consequence.

What I’ve learned is that shame around debt is often more damaging than the debt itself. It keeps people stuck in avoidance instead of action.

If you’re new here, I am actively paying off credit card debt. It’s debt I have been carrying around for several years, without telling anyone in my life.

I decided to stop avoiding the balance last October and can say I’ve gone from over $35k in debt to just under $20k in less than a year. It took facing my feelings about this debt to finally start letting it go.

MYTH 3: “Investing Is for Rich People”

On the topic of investing, you may feel you need to have your financial house completely in order before you can invest. This myth creates intimidation around investing, making it seem like something you do only after you’ve “arrived”.

This fear is especially true for anyone who is new to investing. It may prevent someone from even starting!

The important truth is that investing is how you “arrive”. Waiting until you feel financially ready means waiting forever for most people.

Here’s what’s actually true- investing is how ordinary people build wealth, not by being rich first but by starting small and letting compound interest do the work over time.

The proof is in the math: $100/month invested starting at 25 with a 7% average return grows to roughly $262,000 by 65. The same $100/month starting at 45 grows to roughly $52,000 by 65. 

Time is the actual asset to be leveraged.

Even though I grew up in a family where early investing was discussed, the importance of time related to compound interest did not sink in for me until the age of 32 (mid-divorce).

I have prioritized investing for retirement since I was eligible with my employer (at age 33) and I am happy with the results I’ve had but this has meant I’ve had to make sacrifices.

Starting later means contributing more to achieve the same results as someone who started earlier.

The great news here is it’s never too late to start. Starting late doesn’t disqualify you, but it is important to understand what starting late may cost you.

Once you’ve started investing, the next myth might be holding back how far you can actually go.

MYTH 4: “You Just Need to Spend Less”

The belief that financial problems are always a spending problem is the bedrock of most financial education. The assumption is always “if you’re struggling, you need to cut back.”

Don’t get me wrong- there is a time and place for assessing/cutting back on spending; spending less than you earn is essential to having money.

The limit with this belief is that there is a floor on how much you can cut. Cutting expenses will only take you so far. At some point, there’s just not enough margin (between earnings and expenses) to achieve financial goals. 

You need margin to pay off debt, save for an emergency, or invest.

Here’s the awesome reframe on this one- there is no ceiling on how much you can earn. Income growth is the fastest controllable lever for financial progress and it’s less commonly discussed in the same breath as budgeting.

Financial progress requires both sides of the equation be optimized- controlling spending matters AND growing income matters. 

Most financial advice focuses exclusively on budgeting/spending less, while increasing your income can create margin in your finances quickly.

The moment this clicked for me, I unlocked a whole world of options. Where cutting expenses has a limit, increasing income does not. There are so many ways to make more money.

The easiest place to start earning more is in your 9-5. Check out this post about how I pivoted to a project management role and increased my salary by 30%!

MYTH 5: “Talking About Money is Rude”

Last but not least- let’s debunk the myth that money is a private topic. Many people believe that it’s not polite to discuss salaries, debt, or net worth.

Silence about money disproportionately hurts women. When we don’t talk about salaries we can’t identify pay gaps. 

When we don’t talk about debt we carry shame alone. When we don’t talk about wealth building we stay stuck in systems designed to keep us there.

Here’s the truth- the women getting ahead financially are talking about it, with each other, out loud, and with real numbers. Transparency is a financial strategy.

I’ll never forget when I was just starting out on my divorce journey, when I was desperate for information from someone who had gone through something similar, stumbling on the only book I could find specific to single moms and finance- The Kickass Single Mom.

I soaked up that book like a sponge in the desert. I was so grateful to hear from someone who had already traveled the path I was on.

Money transparency for women is the whole reason Earn More with Jess exists. I’m sharing real numbers and talking about real challenges for women because I needed someone to do that for me.

Psst- Here’s the list of my favorite financial literacy books for beginners, including the book mentioned above.

Conclusion

The myths about money most of us were taught weren’t taught with malicious intent, they are just inaccurate. Inaccurate information is reflected in results, regardless of how hard you work.

The good news is now you know. Knowledge changes behavior and you can do something different today, now.

The first system I’d put in place after unlearning these myths is the 3-account system. It replaces the “save what’s left” approach with something that works automatically for you. 

Grab the free one-page setup guide below.

Disclosure: This post contains affiliate links. If you purchase through my link I may earn a small commission at no extra cost to you.

You finally decide to take retirement seriously and immediately hit a wall of confusing options- Roth 401k, traditional 401k, Roth IRA. What’s the difference and does it even matter?

Most financial content either oversimplifies information or drowns you in jargon. It can take time and experience to learn financial basics in a way that “sticks” or resonates with you. This is normal.

Even a financial advisor may gloss over the account options entirely.

If you’ve been asking yourself should I do Roth or traditional 401k, you’re asking exactly the right question. The answer depends on a few things specific to your situation.

This post breaks down the difference between retirement accounts in plain language, who each option works best for, and when/where a Roth IRA fits into the picture.

As a high earner, I personally use a traditional 401k through my employer (to reduce my taxable income) and a separate Roth IRA through Vanguard to lock in the tax free growth.

The Basic Difference — Roth vs Traditional 401k

Both a traditional and Roth 401k are employer-sponsored retirement accounts. The difference between the two is when you pay taxes.

For a traditional 401k, contributions are pre-tax, meaning you pay taxes when you withdraw in retirement. Your taxable income goes down now which means a lower tax bill today. 

The rate you are taxed at upon withdrawal is dependent on the tax rate you have at the time.

For a Roth 401k, contributions are after-tax, meaning you pay taxes now but withdrawals in retirement are completely tax-free.

In summary: traditional = pay taxes later, Roth = pay taxes now (and never again).

Both accounts have the same contribution limit in 2026- $24,500. 

It’s important to note that the limit considers contributions for traditional and Roth combined, meaning your total contribution to both accounts combined cannot surpass the limit.

There are age exceptions to the contribution limit if you are older:

• Catch up: $32,500 if age 50-59 or 64+
• Super catch up: $35,750 if age 60-63 (and permitted by your plan)

These exceptions can be especially helpful if you feel behind in your retirement savings. 

Both accounts can receive an employer match, although the option for employers to deposit the match into the Roth 401k is new and not offered by all companies. 

My current employer offers both traditional and Roth 401k options, with match dollars contributed to a pretax account.

I have a traditional 401k where I contribute enough to maximize the employer match. 

Should I Do Roth or Traditional 401k?

The deciding factor is your tax situation, specifically considering your current vs. future tax situation.

Choose traditional 401k if:

• You’re in a high tax bracket now and expect to be in a lower bracket in retirement
• You want to reduce your taxable income today (this is useful if you’re close to a tax bracket threshold)
• You need the take-home pay- pre-tax contributions reduce your tax bill now which means more money in your paycheck

Choose Roth 401k if:

• You’re early in your career and expect to earn significantly more later
• You’re in a lower tax bracket now than you expect to be in retirement
• You want tax-free income in retirement and are willing to pay now for that flexibility

Most financial planners say if you’re unsure and you’re in your 30s or 40s, Roth tends to be the better long term bet because tax rates are historically low right now. 

While tax-free retirement income might not be your biggest priority in this season of life, it will be valuable and important in the future.

My Strategy In An Expensive Season Of Life

In my situation, contributing to a traditional 401k has made sense for me given my current income level and given the reality that I’m in an expensive season of life right now. 

As a single mom of two teenagers, the extra take home pay means something to me right now.

Of course, I’d love to take advantage of every tax-advantage available to me but I have had to pace myself by making the best decision given ALL of my priorities.

If you’re in a similar life season with competing priorities, here’s what I will offer you- it matters less which account you choose and more that you contribute to either account in some way. 

Specifically, make sure you are contributing enough to get your employer match and that other financial priorities are taken care of (such as debt payoff, building an emergency fund). 

You can always come back to the tax strategy question and adjust your sail when you are ready to optimize further.

Tax situations are personal and this post is educational, not tax advice. Consult a CPA for guidance specific to your situation.

Where Does the Roth IRA Fit In?

When you hear the term “Roth”, you may confuse the Roth 401k with a separate Roth IRA account type.

A Roth IRA is a different account you can open independently of a 401k ( not through your employer). The Roth IRA is similar to the Roth 401k in that contributions are post tax.

The key differences of the Roth IRA (compared to the Roth 401k) are: 

• Lower contribution limit- $7,500 in 2026
• Income limits apply- you can only contribute directly if you earn under $153,000 as a single filer in 2026 (There is a workaround to this limit, called a backdoor Roth IRA conversion, if you’re above the income threshold. It is outside the scope of this post but may be worth researching.)
• More investment flexibility- you choose your own brokerage and investment options, not limited to what your employer offers
• No required minimum distributions during your lifetime unlike traditional 401k (this will matter in retirement)

The Roth IRA is an important talking point related to this post because it is an investment step that you may consider before completely maxing out your 401k contribution.

Typical Investment Sequence

Here is the investment sequencing most financial educators recommend:

• Step 1: Contribute enough to your 401k to capture full employer match
• Step 2: Max out your Roth IRA ($7,500) and/or Health Savings Account (HSA) if you have one
• Step 3: Go back and increase your 401k contributions if you have more capacity

This is exactly the sequence I’m working towards right now. I am currently on step 1 while building an emergency fund/paying off credit card debt and planning to max out my Roth IRA once the debt is cleared.

I personally have my Roth IRA set up at Vanguard. It is ready to go whenever the funds are available in my take home pay for contribution.

What About the Employer Match?

Regardless of whether you choose a traditional or Roth 401k, contributing enough to get your employer match is the one non-negotiable in your retirement contribution strategy.

An employer match is free money and should always be captured first before making any other retirement contribution decisions.

My current employer matches 7% to the first 6% I contribute. This is an instant 116% return and doesn’t even need further explanation.The math speaks for itself.

I have been able to make a lot of progress on my retirement account balance by prioritizing contributions to obtain the employer match at my company.

And remember, the dollar value matched by your employer will increase as your income increases. For example, 7% of a $100k salary is $7,000 while 7% of a $150k salary is $10,500.

This is just one reason increasing your income is a great lever to pull in your pursuit of financial freedom.

Read more about the contribution strategy I used to invest $100k in just 5 years as a single mom.

No tax strategy beats a guaranteed employer match. Start there, then optimize.

Conclusion

The Roth vs. traditional 401k decision comes down to your tax situation now vs. later. For most women in their 30s and 40s, Roth contributions tend to win long term.

The most important move is always the same- capture your full employer match first, then optimize your remaining contributions.

Want to see how I structure my retirement contributions alongside debt payoff and savings? Grab the free 3-account setup guide- it shows exactly how I make sure retirement contributions happen automatically every payday.

This post contains affiliate links. If you purchase through my link I may earn a small commission at no extra cost to you.

We’ve all heard some variation of the fact that most Americans are one large expense away from going into debt.

The reasons people don’t have an emergency fund can vary. For some, the number feels too big and other things feel more important.

For high earners with steady paychecks and investment accounts, an emergency fund can feel insignificant. After all, I could just pull the money from somewhere if I really needed it, right?

The bottom line is this- having money designated and accessible for emergencies will prevent you from going into debt, borrowing money from another account, or doing some other kind of financial kung fu you might regret down the road.

This post breaks down how to build an emergency fund, in a 12-month plan anyone can follow, at any income level.

If you’ve been putting off building an emergency fund because you don’t know where to start, this is the post for you.

I’m currently building my own emergency fund- my target is $15,000 and I’m sharing exactly how I’m getting there.

Why an Emergency Fund is Non-Negotiable

An emergency fund has become non-negotiable for me. Without money set aside for unexpected expenses, an emergency becomes debt (or sabotages another goal if you pull the money from somewhere else).

As a single mom and the financial safety net for my two teens, the thought of not having a plan in the event of an emergency terrified me. 

At the beginning of 2025, my emergency fund had $1,300 in it. While this is better than nothing, I really sat with the following questions and determined it was not enough.

• What would I do in the event of an emergency? How would I cover an unexpected expense? How would I pay for it and where would the money come from?
• How would I handle losing my job? How long would I be able to support our family?

My answer to that last question was not even one month. That reality sinking in gave me a lot of anxiety. I really was one large bill away from a crisis.

On top of that, I could see how not having an emergency fund had led to maintaining/increasing my credit card debt. 

I knew I had to change something. I wanted to have a clear plan in the event of an unexpected expense.

How Much Do You Actually Need

The standard recommendation is to have 3-6 months of essential expenses set aside for emergencies. Depending on who you talk or listen to, this recommendation may vary. 

For example, some people have a primary residence and a rental property. They may choose to keep additional funds set aside for unexpected home repairs, property maintenance, etc.

For the sake of simplicity, we are going to assume the standard advice of 3-6 months is a good starting point for you.

You might be wondering how to calculate your target emergency fund. Here are the steps to calculate the number for your specific situation:

1. Add up your essential monthly expenses
   • Include things you must pay like rent, utilities, minimum debt payments, groceries, etc.
   • Leave out unnecessary expenses from this equation- example: monthly budget to visit ice cream shop (hey, this could be important to someone)
   • The assumption is that in the event of an emergency, unnecessary expenses would be temporarily paused until finances are stable again
2. Multiply the total by 3 for a starter fund or by 6 for a full security fund. There’s your number!

For most people, around $10,000 will be a reasonable target. This number may vary depending on your unique circumstances.

My fixed expenses are around $5,000 per month right now. This is due to renting in a higher cost of living area (where my kids go to public schools) and due to minimum debt payments.

One thing that has helped me build up my emergency fund, even while paying off debt, is to remember that I don’t need to magically make it appear at once. 

The 12-Month Plan

Once you have determined your target, the next step is to map out how you will fund it.

Breaking your goal down into steps will make it feel more achievable. Let’s be honest, setting aside money will require that you do something different.

Behavior change can take time and may vary over time. The steps below outline setting aside a $10k month emergency fund but can be applied to any amount of money. 

Months 1–3: Build Your Base ($0 → $1,000)

The first thing you will do is open a dedicated high-yield savings account (HYSA) to keep your emergency fund separate from your checking account.

The next step is to automate a small transfer of money every payday. Even $50 a paycheck adds up. When I first started building my emergency fund, this is the amount I contributed.

While it was small, it signaled “progress” to my brain and slowly became a habit.

The first milestone of establishing an emergency fund is getting to $1,000 as fast as possible. 

Quick wins make a real difference here- canceling a subscription and redirecting the funds, selling something on Facebook marketplace, etc.

Get creative!

Months 4–6: Build Momentum ($1,000 → $4,000)

Once you have $1,000 set aside, it’s time to step up your effort. 

If you can increase your automatic transfer, this is a good time to do so. 

I have my automatic transfer set up with my employer direct deposit- $300 automatically deposits into my emergency fund each paycheck. 

Not having to manually make this transfer has been key for me. The money comes out of my pay before I even see it.

Another way to ramp up your contributions is to put any “windfalls” of money to your emergency fund. For example- a tax return, bonus, etc.

Pro tip- use a percentage of any windfall on something just for you. Enjoying money while pursuing financial stability has helped train my brain that stability can be safe and fun.

Don’t forget to celebrate milestones on the way to your goal- $2,000, $3,000 funded. 

Months 7–9: Push Through the Middle ($4,000 → $7,000)

The middle of any goal is where most people stall. The urgency from month one has faded. 

If you’ve developed a habit of saving, it might feel kind of boring. This is good!

Keep the automation running even when it feels slow. 

Now is a good time to revisit your target number- has anything changed in your expenses that would change your goal?

One thing to remember is this- once you reach your target goal, you can redirect the money you are saving to something else. 

Months 10–12: Cross the Finish Line ($7,000 → $10,000)

The process gets easier towards the end. You’re close enough to see the finish line! Use this momentum as fuel.

Consider a one-month push to close out strong. This could include no eating out, taking on a freelance project, or doing a no spend challenge.

Last but not least, make sure you celebrate hitting your goal once you hit it. This is a big deal!

Where to Keep It

The best place to keep money you do not plan to use but may need to access quickly is in a high-yield savings account (HYSA). 

This money should not be in your checking account where you might be tempted to spend it or part of your long-term investments.

I have had success with keeping my HYSA at a completely separate bank. I personally use Ally bank where I earn 3.0% interest and would recommend it to anyone!

I love that Ally allows you to create “buckets” within a savings account. My emergency fund is one bucket but I have others, which allows me to keep all of my savings in one account.

Read more about the simple way I have my financial accounts set up.

Some things to look for in a HYSA include: being FDIC insured, accounts with no monthly minimum fees, options to easily transfer to other bank accounts.

What to Do When You Have to Use It

An emergency fund is meant to be used- that’s the whole point and why you need to have access to it.

When you dip into your emergency fund, your only job is to refill it.

Using the money for what it’s intended for is not a failure, it’s the system working perfectly. 

Once you have stabilized your finances, restart your automatic transfers immediately. 

I admittedly do not have the best track record with using an emergency fund as intended.

For the entirety of my 11-year marriage, I did not have an emergency fund but rather relied on my ex-husband’s business income. That somehow worked for us but it was by no means an organized plan that I will be repeating.

I had a sizable emergency fund established post divorce, leading into 2022. Unfortunately, $30k in unplanned legal fees, combined with lifestyle creep drained this fund.

At the time, I didn’t realize the significance of the fund being drained while I was making lifestyle changes. Looking back, I would have made some different decisions but I can say that I learned from the decisions I did make.

Fast forward 3 years- I can see how important it is to prioritize having an emergency fund available. It offers peace of mind, continuity, and options during instability.

Conclusion

I hope this post has helped you see that saving $10,000 in 12 months is achievable on any salary if you automate the savings and stop waiting for the “right time”.

I encourage you to open a HYSA today- not next week, today. 

Breaking the paycheck to paycheck cycle starts here- learning how to build an emergency fund is one of the most important financial moves you can make.

Want to see exactly how I set up my accounts to make this automatic? Grab the free 3-account setup guide below.

Disclosure: This post may contain affiliate links. If you purchase through my link I may earn a small commission at no extra cost to you.

If you’ve ever Googled ‘high earner not yet rich’ at midnight wondering what you’re missing, this post is for you.

Let me guess what brings you to this post- you are a corporate earner with a good or even great salary. You have had professional success- job offers, promotions, etc. 

Everything on paper looks great but your bank account tells a different story. No matter what you do, you can’t seem to get ahead.

You’ve done everything right and somehow still feel behind.

This isn’t a budgeting post, it’s a clarity post. We’re going to dive into what’s actually going on that leads you to feel behind and what to do about it.

Before we jump into the good stuff, please know that I’ve been in your shoes. I am slowly climbing out of the same hole and sharing my journey along the way.

I’ve been a six figure earner for over 3 years and still managed to amass over $35k in credit card debt. Nobody in my life knew.

From the outside, it seemed like I was responsible and had it all together. Sound familiar?

It’s Not a Discipline Problem

When you earn good money and still struggle, the most common assumption is something must be wrong with you. I can tell you I’ve frequented the “what’s wrong with me” inner dialogue. 

The reality is that feeling behind financially while earning a good income is a structural problem, not a personal one.

High earners stay stuck for various reasons:

1. Lifestyle inflation (“lifestyle creep”) keeps pace with income increases. In this situation, every raise gets absorbed into spending.
2. Nobody taught us how money should actually move. We learned by watching and most of what we watched was broken.
3. The financial system wasn’t designed with women in mind. Financial literacy has historically been a male domain.

I can speak from personal experience around the impacts of lifestyle creep. Most notably, when I increased my salary by 30% by pivoting into project management, it’s as if the money just evaporated. Poof!

Earning more and watching it slip through your fingers, only to be right back where you started, can feel like being on a hamster wheel. Maybe you can relate.

What I have learned, and what I’d like you to know, is that the problem was never your discipline. The problem was the system- and nobody handed you the manual.

The High Earner Not Yet Rich Trap

Lifestyle inflation is the sneakiest way that increases in income fall flat. It’s easy to use a larger paycheck as justification to “treat” yourself, to upgrade your vehicle, or splurge on a vacation.

Now don’t get me wrong- I 100% support celebrating your wins and financial milestones. The difference is this kind of celebration is planned and a one-time expense. 

Lifestyle inflation is different because it is a sustained expense, over time. It can feel like progress to upgrade your routine or lifestyle. 

If not carefully planned for, this kind of expense actually negates progress. 

Using your raise to rent a slightly nicer apartment or to eat out more frequently can absorb every dollar of income growth if you’re not careful.

The result is income goes up, net worth stays flat, and the paycheck to paycheck feeling persists even at $100k+ salary.

The KIA That Cost Me

I’ll share a very specific example of how lifestyle creep invaded my life. In 2024, I was on the cusp of paying off my 2019 KIA Sorento when it started making a weird sound.

I took it into the dealership and somehow got talked into trading in the equity I had for a lease on a new model. Like what?

I traded in an almost paid off vehicle for a $428/mo lease payment. I am still paying on this lease and rest assured, I fully plan to turn in the lease and buy a used vehicle outright.

Looking back, I can see clearly what happened- I let the emotions of having a vehicle needing a repair weigh on me to the point of giving up an asset.

I traded equity for convenience.

Once I was out of my dealership- induced haze (it took a few weeks), I could see that I had made an irrational decision.

I have kicked myself many times over this decision but the bottom line is this- making decisions that lead to financial setbacks is not a debt problem, it’s a pattern.

What’s Actually Keeping You Stuck

Let’s name three specific culprits that contribute to the pattern of backwards progress: 

1. You may not have a system for how money moves. This likely looks like spending money first and saving whatever is left after.
2. Emotional spending as stress relief could be part of the puzzle. High earning often comes with high stress and spending feels like a reward.
3. Avoiding the numbers. When things feel out of control, looking feels worse than not looking.

In my case, I did not have an issue with avoiding my numbers. I knew all too well what was going on with my finances.

My experience was not having a good money system combined with the occasional emotional expenditure.

For the most part, my emotional purchases were small/inconsequential but then I would go and you know, lease a vehicle on a whim.

I still occasionally struggle with the lure of impulsive, large, unplanned purchases. The difference now is that I see the temptation for what it is and lean on the money system I have set up.

An important reframe I have made for myself time and time again is that none of these behaviors are character flaws. 

They are completely predictable responses to a stressful life with no financial framework.

What to Actually Do About It

So how do you get out of this cycle? Let’s talk about it. Here are three shifts that will change your experience with money tremendously.

Shift 1: Get a system- money needs to move automatically before you have a chance to spend it. Check out my 3-account money system if you want to set up something that is simple and will have an impact right away.

Shift 2: Know your number- what number will enable you to be financially free? Or in other words, how much money do you need invested to become work optional? 

A simple starting point is to multiply your annual expenses by 25. That’s the invested amount that could theoretically support your lifestyle indefinitely. Most high earners never calculate this. 

Shift 3: Stop optimizing spending and start optimizing income. There’s a ceiling on how much you can cut, there’s no ceiling on how much you can earn. 

My Breaking Point

Last October, I decided I’d had enough with my credit card debt and minimal emergency fund. As a single mom of two teens, this was a risk and I knew it.

So I created a plan to pay off my credit card debt, reducing $35k to less than $20k in 9 months.

I set up a money system to ensure that money is deposited into my emergency fund on pay day- I never even see that money so I’m not tempted to spend it. Read more about how to build an emergency fund.

I made a decision to create a better pattern for my money.

Conclusion

Being a high earner who isn’t yet rich isn’t a failure, it’s a starting point.

The gap between where you are and where you want to be is closeable, and it closes with systems and clarity, not shame and restriction.

The good news is that with an already high income and the right system, you will make progress FAST. You are in a much better position than you may realize.

Ready to transform your money routine? Grab the free 3-account setup guide- it’s the system I use to make sure my money moves in the right direction automatically, every single payday.

Disclosure: This post contains affiliate links. If you purchase through my link I may earn a small commission at no extra cost to you.

Maybe you’re like me and have experienced the panic of logging into your retirement account, seeing the balance, and immediately wondering if you’re behind.

For years, this was a recurring experience for me.

The truth is most people have no idea what a “good” 401k balance actually looks like at their age- they just know they feel behind.

If you’ve been searching for what a good 401k balance by age looks like, you’re in the right place- and you’re asking the right question.

This post covers the benchmarks, the real talk about why most people are behind, and the contribution strategy I personally used to build retirement savings without maxing out.

If you’re new here- I have been rebuilding my finances in my 30s, after divorce. I’ve built my retirement savings primarily by contributing enough to get the full company match, growing my income strategically, and choosing employers with strong employer match programs.

I started contributing to my 401k in July 2021 and as of July 2026 (just 5 years later), I have surpassed $100k invested in that account alone.

Keep reading to see how I did it.

The Benchmarks- What a Good 401k Balance by Age Actually Looks Like

The most commonly cited benchmarks measure your 401k balance by age using your salary. Fidelity’s guidelines are the most widely referenced:

• By 30: 1x your salary saved
• By 35: 2x your salary
• By 40: 3x your salary
• By 45: 4x your salary
• By 50: 6x your salary

At first glance, these numbers seem scary for most people- and that’s okay. 

Remember, these are guidelines not verdicts. They assume you started saving at 22 with no interruptions- divorce, job loss, debt payoff, health issues, etc. 

Most women’s financial timelines don’t look like that.

At the time of writing this post, I am not meeting the target benchmark for my age.

However, I am very proud/happy of the progress I have made on my retirement savings, especially considering I had almost ZERO dollars just 5 years ago, at the age of 33. 

Rather than target a raw balance, the priority for me over the past 5 years has been to contribute enough to my 401k to get the employer match and that’s it.

I prioritized landing a new role at a company with a higher employer match and increasing my salary through promotions, ultimately increasing my 401k contributions.

Pitfalls of 401k Benchmarks

This seems like a good time to offer a few weaknesses in the 401k by age benchmarks referenced above:

• Assume a fixed retirement age of 65
• Do not account for variations in salary- for example:
  • Some career choices could delay or prohibit standard retirement contributions for some time (example- medical school)
  • During peak earning years (typically 45-54 years old), generous retirement contributions could be more feasible
• Do not consider lifestyle changes that may happen during retirement- you could choose to significantly lower your fixed living expenses in retirement!
• Do not account for future (unknown) tax or other retirement account distribution changes

Bottom line- these benchmarks exist to give you a target, not to make you feel like a failure for being human. 

At the end of the day, your situation is unique to you and may include outliers to the “average”. Keep that in mind as you continue reading.

Why Most Women Are Behind- and Why It’s Not Their Fault

Before we jump into contribution strategies, let’s have a moment to acknowledge the truth about why women in particular feel behind.

The gender pay gap means women have less to contribute over a lifetime as compared to men. On average, women earn 82 cents for every $1 earned by white men. This gap widens further for women of color.

Career interruptions such as maternity leave and childcare disproportionately affect women’s retirement savings. Being out of the workforce limits the amount that can be contributed to retirement accounts.

Women live longer on average, meaning they need more saved but often have less. 

This is not to mention that retirement investing has historically been presented as complicated and male-dominated. Even when women are ready to invest, the barrier to entry seems higher.

My Experience Being Out of the Workforce

To share a bit of my personal experience, I took over 1.5 years off and an additional almost 4 years working part time with my ex husband in his business, to care for our kids when they were little.

This resulted in time where I was out of the workforce, not contributing to my retirement accounts or developing my career.

The impact of my career gap became obvious when I re-entered the work force at 32 years old during my divorce. 

This all might sound depressing but my point is this- you can start to build what you want today.

You can increase your income, start learning about financial literacy, and build your retirement savings any time, from any starting point. 

Being behind isn’t a personal failure. It’s a predictable outcome of a system that wasn’t designed with women in mind. The question is what you do from here.

The Contribution Strategy I Actually Used

The conventional advice is to max out your 401k ($24,500 in 2026)- but that’s not realistic for everyone, especially women with single income households, managing debt payoff, building an emergency fund, or [insert any other financial priority].

So what do you do if you can’t max out your 401k?

Contribute Enough to Get Your Employer Match

Contribute exactly enough to capture your full employer match- not a dollar more until other financial priorities are handled.

First off, what is an employer match? This is the amount of money your employer contributes to your 401k against the amount you contribute.

I’ll use my current employer match as an example: my employer matches up to 4% for the 6% that I contribute, in addition to a 3% non-elective contribution. 

This means if I contribute 6% of my salary to my 401k, my employer contributes 7%. This is an instant 116% return on my money!

No investment beats a guaranteed employer match. This is free money that most people leave on the table.

Pivot to a Company With a Higher Employer Match

I’ve shared openly about how I have increased my salary. 

In addition to increasing my salary, I pivoted to a company with a higher employer match. This is a lever I have pulled strategically to increase my retirement contributions, without increasing my contribution percentage.

I didn’t build my retirement savings by sacrificing everything else. I built it by being strategic about what I contributed, who I worked for, and how much I earned.

What to Do If You’re Behind

Most women reading this are behind by the benchmarks and that is completely normal given everything we’ve already covered.

If you’re feeling frustrated or ashamed about your situation, please know that these feelings are completely normal. 

You don’t need to talk yourself out of how you feel; you need to do something different.

I will reiterate that you can take a step in the right direction today. Below are three actionable steps to take in order of priority:

1. Capture your full employer match immediately if you aren’t already. This is non-negotiable, regardless of any other financial situation.
2. Handle high interest debt and build your emergency fund before increasing contributions beyond the match. The math supports this.
3. Increase your contribution percentage by 1% every time you get a raise. You won’t feel it because your take home pay still goes up.

The Power of Compounding Consistency

You’ve probably heard that saying: “The best time to start was yesterday. The next best time to start is today.”

I can’t stress how true this is for investing- compound interest rewards consistency over time. Starting or increasing contributions now matters more than picking the perfect time to start.

At the time of writing this, I am on step 2 of the above. I am SO close to reaching my emergency fund target and my consumer debt will be paid off next year.

Once I’ve reached these goals, I will repurpose the funds I’ve been using (almost $2k per month), towards investments.

If you’re not sure how to sequence your financial priorities, check out this post on how I automate my finances: How to Stop Living Paycheck to Paycheck: Try this 3-Account System Instead.

The Roth IRA Conversation

s I’m sure you know, a 401k isn’t the only retirement vehicle.

If your employer match is captured and you have additional capacity, a Roth IRA (or Health Savings Account/HSA if you have a high deductible health insurance plan) is the natural next step.

As of 2026, the contribution limit for a Roth IRA is $7,500 per year.

The key benefit of contributing to a Roth is that you use after tax dollars to invest. This means you benefit from tax-free growth and withdrawals in retirement.

I personally use Vanguard to manage my Roth IRA. You can open an account in about 10 minutes.

Conclusion

In summary, a good 401k balance by age is a useful benchmark, not a final grade. Where you are right now is your starting point, not your ceiling.

The most important move is the next one- capture your match, free up funds by paying off debt, increase your contributions by 1% at your next raise, and open a Roth IRA if you haven’t already.

Grab the free 3-account setup guide to see how I structure my finances so retirement contributions happen automatically before I have a chance to spend the money.