Just curious, what's your personal savings rate?

[david_mcmanus]

I was just running some numbers and I've determined that my personal savings rate is a whopping 45%. I'm still maxing out my 401k and slamming money that I was putting towards vehicles (they're paid off now) into my money market accounts. Ever other month or so, I'll make a planned bulk deposit into my savings account. Even though that sounds like a big number, I feel my family still has plenty for all the necessary expenses and we have an emergency fund of around 9 months. I'm just curious, how much is everyone else saving?

[Markor]

When I'm working it's ~50%. I'm looking forward to having a paid-off house so my one-year emergency fund can be slashed with the final payment (renting now).

[TJ_98370]

[david_mcmanus]

Gross.

[biliruben]

What is this "savings" you speak of?

Like a passbook account or something; right out of 1971?

I haven't had savings since I was a little kid with a piggie bank.

I'm just not sure where to the draw the line and what your denominator is. Net or gross?

We are putting about 12% of our gross into employee retirement, another 4% into Roths, another 4% into college accts. I guess you could consider that all "savings" though I think of them as investments.

I guess I can count the 5% towards paying down mortgage principal (you know, "forced savings".) Of course I'm "losing" 95% of our gross income a month through declining housing values, so maybe I should treat this as - 90%?

But we are paying 17% in mortgage interest, taxes and insurance as well. Since I'm getting maybe 4-5% of our gross income back through deductions come tax time, can I consider that "savings"?

If you aren't counting any of that, conservatively my savings is pretty close to nil.

If you chose a more generous interpretation, maybe 30%.

Ungenerous: - 65%.

That's a pretty wide gap. Is there a book-keeper in the house!?!

[biliruben]

Is that 45% including or excluding retirement accounts?

If it's excluding, I can only deduce you either make 200K a year, or you force your family to subsist on Top-Ramen and vacation at Hanford.

[david_mcmanus]

That excludes and we don't eat top ramen, but at the same time I didn't jump on the HELOC / extravagance bandwagon when it was fashionable. HELOCs are so 2005 and faux riche, don't you think?

That being said, I know people that make a third of what I make and still manage to sock away tons because they've just never really been big spenders. I guess it's who I flock with.

I, for one, welcome the death of a credit economy.

[TJ_98370]

Along the same line as biliruben' comment:

Are mandatory retirement contributions savings?

Is reinvested return on investment savings?

[david_mcmanus]

[biliruben]

I consider myself pretty frugal myself, but ringing in:

22% for housing
28% Taxes
8% Daycare

I'd have to be -3% frugal for retirement, food, clothing, utilities and entertainment to hit 45% savings the way you define it.

Maybe you own a house free and clear (or live in a cave) and are a tax-refuser, but that just doesn't add up in anybody's world I know, no matter how big a spender they are.

[david_mcmanus]

It adds up because I have a good income and bought a house that was reasonably priced in the earlier part of this decade. I also don't have daycare costs since my wife is a stay at home mom and we also have family close by that loves to give her a break every chance they get. I also am one of these evil people that uses tax loopholes to minimize my tax bill. I'm nowhere near 28%, dude. Forget that!

[biliruben]

Well if you just wanted to brag that you make a lot of money, why didn't you just say so. Jeez.

It's not hard to live below your means when your means are high, and you are lucky enough not to have to pay what others consider mandatory costs of living.

[SeattleMoose]

For the past 20 years I have been putting 5% of monthly gross into 401Ks, stocks, etc.

First 10 years I let "investment advisers" guide me. My return was 2/3% a year. Then I decided to actively take over my own portfolio and follow my own instincts. Since then my return on investment has been, shall we say, a LOT better!!

Biggest fear is that my SS, Pension, and savings will be worth just a fraction due to collapse of dollar.

"Excuse me sir, but would you like ketchup with your dog food?"

[biliruben]

The dollar is collapsing?

Talking to some older folks, I've been quite surprised as to how generous some of the pension plans are.

Given that it is beyond rare for someone of my generation to have any pension at all, coupled with the under-funding of social security and companies taking away their 401K match, things are going to be much worse for a lot of retirees, once the baby-boomers get through eating up all the benefits.

[TJ_98370]