What % of your income are you saving for retirement?

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
Topic Author
crowd79
Posts: 640
Joined: Sun Nov 18, 2012 9:37 pm

What % of your income are you saving for retirement?

Post by crowd79 »

For me, it is 30% at age 33. I guess I am quite aggressive....just wondered about others??
NYBoglehead
Posts: 1588
Joined: Fri May 25, 2012 9:38 am

Re: What % of your income are you saving for retirement?

Post by NYBoglehead »

I'm between 20-25%. It will probably drop once our income goes up, after maxing out all tax-advantaged space I'm probably going to work on knocking out my soon to be acquired mortgage on an accelerated schedule.
Khanmots
Posts: 1241
Joined: Sat Jun 11, 2011 2:27 pm

Re: What % of your income are you saving for retirement?

Post by Khanmots »

I'm around 35% and would like to be around 40%. Age 33 as well
ao0680
Posts: 7
Joined: Tue Jan 29, 2013 5:03 pm

Re: What % of your income are you saving for retirement?

Post by ao0680 »

about 30% and I'm 32.
BudgetForWealth
Posts: 21
Joined: Sat Jan 12, 2013 11:03 pm
Contact:

Re: What % of your income are you saving for retirement?

Post by BudgetForWealth »

Roughly 25% right now with the 401k and Roth IRA. I'd like to bump it up using taxable accounts.
Long Pham
Khanmots
Posts: 1241
Joined: Sat Jun 11, 2011 2:27 pm

Re: What % of your income are you saving for retirement?

Post by Khanmots »

NYBoglehead wrote:I'm between 20-25%. It will probably drop once our income goes up, after maxing out all tax-advantaged space I'm probably going to work on knocking out my soon to be acquired mortgage on an accelerated schedule.
I tend to count extra payment put towards mortgage principle as retirement contributions since as long as I put the freed cash-flow from year X when it's paid off early until year Y when it was initially scheduled to be paid off towards retirement then I've essentially put the money into retirement accounts today earning a guaranteed fixed rate of return. In other words, I treat it as no different than a CD with each month's extra principle contribution having a different duration than the previous.
Grt2bOutdoors
Posts: 25617
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: What % of your income are you saving for retirement?

Post by Grt2bOutdoors »

40-50%, give or take a percent or two. Make hay while the sun shines.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions
drs85
Posts: 50
Joined: Thu Apr 19, 2012 7:44 pm

Re: What % of your income are you saving for retirement?

Post by drs85 »

37.29% :greedy
Daniel | "Knowledge is the only thing no one can ever take away from you" - My Father
MnD
Posts: 5184
Joined: Mon Jan 14, 2008 11:41 am

Re: What % of your income are you saving for retirement?

Post by MnD »

People have widely varying definitions of what to count as savings as well as income.
They are also very unlikely to "average out" and remove from savings large infrequent expenses like a new kitchen or vehicle paid with cash.

And some people are real champs at saving and real chumps when it comes to investing, real estate transactions, bankrolling human sponges such as adult children, financially reckless spouses etc. Current household net worth as a percentage of lifetime cumulative earned income is a more telling statistic as it integrates savings, withdrawals from savings and long-term investment performance.
Last edited by MnD on Thu Feb 07, 2013 1:48 pm, edited 1 time in total.
70/30 AA for life, Global market cap equity. Rebalance if fixed income <25% or >35%. Weighted ER< .10%. 5% of annual portfolio balance SWR, Proportional (to AA) withdrawals.
WendyW
Posts: 345
Joined: Sat Dec 08, 2012 3:01 pm

Re: What % of your income are you saving for retirement?

Post by WendyW »

Khanmots wrote:I tend to count extra payment put towards mortgage principle as retirement contributions
Agreed. Even the non-extra mortgage payments could be considered to be saving towards your retirement, to some extent.

I currently save 25-30% of my gross income for retirement, but I rent and don't have a mortgage.
I feel that person that has a mortgage and that is also saving 15% of their gross could arguably be saving more for retirement than I am.
NYBoglehead
Posts: 1588
Joined: Fri May 25, 2012 9:38 am

Re: What % of your income are you saving for retirement?

Post by NYBoglehead »

Khanmots wrote:
NYBoglehead wrote:I'm between 20-25%. It will probably drop once our income goes up, after maxing out all tax-advantaged space I'm probably going to work on knocking out my soon to be acquired mortgage on an accelerated schedule.
I tend to count extra payment put towards mortgage principle as retirement contributions since as long as I put the freed cash-flow from year X when it's paid off early until year Y when it was initially scheduled to be paid off towards retirement then I've essentially put the money into retirement accounts today earning a guaranteed fixed rate of return. In other words, I treat it as no different than a CD with each month's extra principle contribution having a different duration than the previous.
Thanks Khanmots, I like that way of looking at it. I'm not there yet since I'm just looking at houses now, but that's the plan after I put ink to paper on it. After maxing out all tax-deferred accounts, of course.
WHL
Posts: 789
Joined: Mon Dec 10, 2012 1:22 pm

Re: What % of your income are you saving for retirement?

Post by WHL »

about 50%.

maxing 401k, Roth IRA, i-bonds, and an additional 10-20k a year in taxables. I could do more if tightened up my budget but I'm okay with it for now.
leo383
Posts: 569
Joined: Thu Nov 29, 2007 8:36 pm
Location: Durham, NC

Re: What % of your income are you saving for retirement?

Post by leo383 »

I knew Bogleheads were savings outliers, but I had no idea. :eek:

We save about 20%
User avatar
hand
Posts: 2196
Joined: Sun May 17, 2009 8:42 pm

Re: What % of your income are you saving for retirement?

Post by hand »

Maxing 2x 401(k) + 2x ROTH IRA + company contributions Cash Balance pensions = roughly 25%.
Our living expenses are reasonable, and under 40 with 3x salary in tax deferred so have a good base and not too worried about ramping up the savings percentage.

Extra cash at the end of the year goes to repaying (cheap) housing debt.
bradshaw1965
Posts: 826
Joined: Tue Jul 31, 2007 9:36 pm

Re: What % of your income are you saving for retirement?

Post by bradshaw1965 »

It's been 20%. Now that my son is finishing up college it will probably jump a bit.
User avatar
hand
Posts: 2196
Joined: Sun May 17, 2009 8:42 pm

Re: What % of your income are you saving for retirement?

Post by hand »

leo383 wrote:I knew Bogleheads were savings outliers, but I had no idea. :eek:

We save about 20%
There is of course a bit of a selection bias in both this community and this thread!
MathWizard
Posts: 6542
Joined: Tue Jul 26, 2011 1:35 pm

Re: What % of your income are you saving for retirement?

Post by MathWizard »

At least 15% per year. Usually 20-30%

Second child is entering college this fall, I may have to drop back to 15%
for awhile.

If I count my mortage payment which will go poof about the same time
as my second child graduates, it would be another 10% higher.
I do intend to save that money for retirement.
nimo956
Posts: 913
Joined: Mon Feb 15, 2010 5:07 pm

Re: What % of your income are you saving for retirement?

Post by nimo956 »

I save about 45-50% of gross income
50% VTI / 50% VXUS
User avatar
Chan_va
Posts: 869
Joined: Wed Dec 05, 2012 6:15 pm

Re: What % of your income are you saving for retirement?

Post by Chan_va »

Say you make 10k, and you save 1k pre tax and 1k post tax. What total % is that? Is it 20%? Or something different based on your tax bracket?
fcox85
Posts: 144
Joined: Fri Nov 16, 2012 3:13 pm

Re: What % of your income are you saving for retirement?

Post by fcox85 »

Starting in 2013, we increased my contributions to max out my 401(k). Depending on whether you include employer match, it's 18-21% of gross. I'm 28, my wife is 24.

Once my student loans are paid off (most likely later this year), we plan to increase that by trying to max out Roths every year as well.
armeliusc
Posts: 544
Joined: Wed Dec 21, 2011 8:40 am

Re: What % of your income are you saving for retirement?

Post by armeliusc »

About 40% of gross income, or 47% of (what I call) "take home" at age 32. I guess the challenge is to not let this rate go down as life "happens".
User avatar
lauren_knows
Posts: 193
Joined: Mon Jan 28, 2013 2:11 pm
Location: NoVA, USA
Contact:

Re: What % of your income are you saving for retirement?

Post by lauren_knows »

We're saving ~50-60% depending on how you calculate with pre/post tax money. It'd be more if my wife was working full-time. Age 31.
41 - Married - 2 kids - Aiming for FI/ER in early 40s - Creator of cFIREsim
User avatar
Ice-9
Posts: 1579
Joined: Wed Oct 15, 2008 12:40 pm
Location: MD

Re: What % of your income are you saving for retirement?

Post by Ice-9 »

The previous four years it has varied between 29% and 46%. However, sadly, this year it will be less, but for a happy reason. We're saving for a wedding and replenishing emergency fund after new furnace and AC, and I project only saving 12% in retirement accounts. Age 39.

EDIT: Re-reading this thread, I just realized I made a mistake. I work for a local government that offers a mandatory 401(a) plan, which is like just the matching portion of a 401(k), as well as an optional 457 plan. For the mandatory 401(a), I was counting the entire yearly contribution, which includes what my employer matches - Woops! When I consider just the employee portion of the 401(a), it looks like all of my percentages listed above go down about 8%.

So, using gross income and only counting the employee portion of the mandatory account, my retirement savings varied from 21%-38% over the last four years, and my low savings this year will probably amount to 4%.
Last edited by Ice-9 on Fri Feb 15, 2013 4:00 pm, edited 2 times in total.
User avatar
englishgirl
Posts: 2508
Joined: Thu Mar 01, 2007 4:34 pm
Location: FL

Re: What % of your income are you saving for retirement?

Post by englishgirl »

I guess that I'm at about 15%.

I'm saving a lot for other things right now. Once that is all finished, I hope to bump up the retirement savings.
Sarah
User avatar
VictoriaF
Posts: 20122
Joined: Tue Feb 27, 2007 6:27 am
Location: Black Swan Lake

Re: What % of your income are you saving for retirement?

Post by VictoriaF »

Does income include investment income or only employment income?

Victoria
Inventor of the Bogleheads Secret Handshake | Winner of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)
User avatar
Clark & Addison
Posts: 257
Joined: Mon Jan 14, 2013 11:15 am

Re: What % of your income are you saving for retirement?

Post by Clark & Addison »

I say that we (both 29) only save 15% of our gross towards retirement, but with both of our company matches it would be right at 20%. We are also planning on having our mortgage paid of in the next 3 months, which will allow us to bump up the amount we save towards retirement.
eaglesfogbowl
Posts: 22
Joined: Wed Sep 19, 2012 9:07 am
Contact:

Re: What % of your income are you saving for retirement?

Post by eaglesfogbowl »

31, my wife is 33... I project that we save about 24% of our total compensation this year (we're immediately vested in all 401k match so I count it). In addition we're putting away an addition about 20% towards short term goals (a vacation, a new to us car, etc, this year then starting to pay additional on mortgage starting in 2014 with a goal of payoff by end of 2017).

So up until 2018 we'll be saving about 24-30% of our total comp, then when the house is paid we'll probably cap it at 50% and let our lifestyle expand/possibly upgrade our house with a mortgage about 25-35% of it's purchase price.
NYBoglehead
Posts: 1588
Joined: Fri May 25, 2012 9:38 am

Re: What % of your income are you saving for retirement?

Post by NYBoglehead »

Clark & Addison wrote:I say that we (both 29) only save 15% of our gross towards retirement, but with both of our company matches it would be right at 20%. We are also planning on having our mortgage paid of in the next 3 months, which will allow us to bump up the amount we save towards retirement.

Mortgage paid off at 29! That is awesome. Congrats.
scone
Posts: 1457
Joined: Wed Jul 11, 2012 4:46 pm

Re: What % of your income are you saving for retirement?

Post by scone »

About 50% of gross income. We paid off the house last year, which makes things a lot easier. 4 years to go until retirement, so we're on a mission. :)
"My bond allocation is the amount of money that I cannot afford to lose." -- Taylor Larimore
User avatar
Aptenodytes
Posts: 3786
Joined: Tue Feb 08, 2011 7:39 pm

Re: What % of your income are you saving for retirement?

Post by Aptenodytes »

About 30% for me too. I've tried to up the percentage every time I got a raise.
(this is a percentage of gross income from salaried and contract work, which I think is the only comparable metric)
Khanmots
Posts: 1241
Joined: Sat Jun 11, 2011 2:27 pm

Re: What % of your income are you saving for retirement?

Post by Khanmots »

WendyW wrote:
Khanmots wrote:I tend to count extra payment put towards mortgage principle as retirement contributions
Agreed. Even the non-extra mortgage payments could be considered to be saving towards your retirement, to some extent.

I currently save 25-30% of my gross income for retirement, but I rent and don't have a mortgage.
I feel that person that has a mortgage and that is also saving 15% of their gross could arguably be saving more for retirement than I am.
Yeah, or at least the principle part of the payment could... but exactly how to treat a mortgage in an AA is such a tricky thing.

Gonna be nice when I get this house paid off in 9.5 years... be able to funnel a lot more towards "real" retirement accounts then. :D
Default User BR
Posts: 7502
Joined: Mon Dec 17, 2007 6:32 pm

Re: What % of your income are you saving for retirement?

Post by Default User BR »

I put 25% of salary into the 401(k), plus catch-up, and 6500 into a Roth IRA. From there whatever isn't spent is saved, but I don't bother to figure out what that amount is.


Brian
User avatar
ofcmetz
Posts: 2465
Joined: Tue Feb 08, 2011 7:09 pm
Location: Louisiana

Re: What % of your income are you saving for retirement?

Post by ofcmetz »

Last few years we shot for about 25%. Usually we save a little more than this.
Never underestimate the power of the force of low cost index funds.
User avatar
C319
Posts: 87
Joined: Wed Jan 05, 2011 1:38 pm
Location: Texas

Re: What % of your income are you saving for retirement?

Post by C319 »

20% of gross
MoonOrb
Posts: 1505
Joined: Thu Jan 24, 2013 5:58 pm

Re: What % of your income are you saving for retirement?

Post by MoonOrb »

Age 37, saving 30% of gross income.
Savvy
Posts: 367
Joined: Sat May 05, 2012 3:09 pm

Re: What % of your income are you saving for retirement?

Post by Savvy »

About 30% of gross. Age 23&24.
rr2
Posts: 1071
Joined: Wed Nov 19, 2008 9:04 pm

Re: What % of your income are you saving for retirement?

Post by rr2 »

Deleted
Last edited by rr2 on Thu Feb 07, 2013 4:49 pm, edited 1 time in total.
letsgobobby
Posts: 12073
Joined: Fri Sep 18, 2009 1:10 am

Re: What % of your income are you saving for retirement?

Post by letsgobobby »

it varies between 30-50% of gross, with employer retirement contributions considered in both the numerator and denominator.
spotty_dog
Posts: 93
Joined: Thu Jul 26, 2012 9:06 am

Re: What % of your income are you saving for retirement?

Post by spotty_dog »

We're in our thirties with two kids and one income. Last year about 25% of AGI went toward retirement account contributions. We also put money toward college savings and paying down the mortgage a bit.
User avatar
nirvines88
Posts: 391
Joined: Thu Dec 29, 2011 4:38 pm

Re: What % of your income are you saving for retirement?

Post by nirvines88 »

In 2012 I saved a little over 65% of my pre-tax work salaries (1 full-time job, 1 part-time job). This does not include investment income (which is typically set to reinvest). Maxed out Roth, nearly maxed the 401k (couldn't max because I didn't have access for whole year), and added a bit to taxable accounts. This was an unusual year though, as I worked part-time and finished up my master's degree the first few months of the year before going on to full-time employment.

For 2013 I hope to save about 45% of my pre-tax salaries. I don't make much, but I also live pretty cheaply since I'm young, have cheap rent/roommates, and have simple hobbies (e.g. running). I don't feel like I'm living that frugally, as I buy any food I want and all the stuff I want (although I don't want much). :wink:

My only expensive interest (that I'm trying to make into more of a true hobby) is traveling. In addition, a house in a few years (if I go that route) will likely throw a wrench into retirement savings, so I'm trying to get a good head start!
"Beware of little expenses, a small leak will sink a great ship" - Poor Richard
michaelsieg
Posts: 624
Joined: Mon Jan 07, 2013 10:02 am

Re: What % of your income are you saving for retirement?

Post by michaelsieg »

I barely spend 20% of my net income, i.e. save about 80% of my net income, my wife has a savingsrate of about -400% of her income, which she spends mostly on our kids, and at the end we save about 15%/month of our combined income....
Last edited by michaelsieg on Thu Feb 07, 2013 4:40 pm, edited 5 times in total.
mac808
Posts: 522
Joined: Mon Sep 19, 2011 8:45 pm

Re: What % of your income are you saving for retirement?

Post by mac808 »

80% of after-tax income. No kids, no car, no other major expenses other than rent.
Random Poster
Posts: 3314
Joined: Wed Feb 03, 2010 9:17 am

Re: What % of your income are you saving for retirement?

Post by Random Poster »

It depends on how you calculate the numbers (since I get paid in multiple currencies, some of it tax-free, and I never can quite figure out what my tax numbers are on the taxable portion until well after the fact), but:

If I count all of my income (salary, bonus, dividends, pre-inheritance checks, etc), and count all of my investments (taxable investing, IRA contributions, 401K contributions, etc), I think that I'm saving somewhere between 75% of gross income and 90% of net income.

This level of savings (and income) won't last forever, so I'm trying to make the most of it while I can.
nodenuff2
Posts: 382
Joined: Tue Mar 06, 2012 3:08 pm
Location: Deep South

Re: What % of your income are you saving for retirement?

Post by nodenuff2 »

When the increase in the value of my Defined benefit plan is added to my 401k savings and company match about 95% of my salary not including any increase in value the 401k might have. God is sooo good.
2014 No. 42 2015 No.342 2016 No. 6 2017 238 2018 no. 175 2019 no. 144 6 year average 157.83. Proves I am just an average investor.What do I know? "Good bless America land that I love..."
Topic Author
crowd79
Posts: 640
Joined: Sun Nov 18, 2012 9:37 pm

Re: What % of your income are you saving for retirement?

Post by crowd79 »

Maxing out IRA every year and getting the employer match on my 401k + EE Bonds = my 30% of income. When I have more income available, I will have to decide whether to contribute more to the 401k (with lousy 1% ER fund options) or in taxable but tax-efficient low ER stock index funds.
mrspremise
Posts: 150
Joined: Wed May 23, 2012 3:01 pm

Re: What % of your income are you saving for retirement?

Post by mrspremise »

Let's see, pre-tax income...
28% goes into our tax-advantaged retirement savings vehicles (401k and Roth IRA)- this is all retirement
14% went into a 529 this year and last year, though we might stop after the third year to just let our money work (not exactly retirement, but savings)
10% goes into a DSPP plan, with our primary intention being to sell it and diversify into our other investment, so some of that could turn into the Roth IRA above or the 529
Anything left over (when our cash reserves get higher than we need) goes into our taxable portfolio. We might decide to sell off the house at some point when we get a windfall we are expecting which means more savings down the road.

I guess 38%+ for retirement, dual career (ages 31 and 32) with 1 kid
stoptothink
Posts: 15368
Joined: Fri Dec 31, 2010 8:53 am

Re: What % of your income are you saving for retirement?

Post by stoptothink »

Was ~60% last year, but had to make a significant cash purchase a few weeks ago which almost completely drained my emergency fund so it will be significantly lower the next 6 months or so as I rebuild cash reserves.
DVMResident
Posts: 1812
Joined: Mon Aug 01, 2011 8:15 pm

Re: What % of your income are you saving for retirement?

Post by DVMResident »

Household: age 30 + 33, ~22.8% on a pre-tax basis, broken down as follows:
2 x IRAs
4.8% into a 403(b) including the match
2.8% in a 403(b) (no match :| )
4.2% contribution towards pension that gives a COLA'ed 2.5%* based on the 3 year weighed average salary of the highest pay (assuming your claim starts at 65 years old), 3.5 years into the program so far

*I'm guessing the pay out for government pensions will change over the next 30 years, but for now it seems like a good deal
tim1999
Posts: 4203
Joined: Tue Dec 16, 2008 6:16 am

Re: What % of your income are you saving for retirement?

Post by tim1999 »

Somewhere between 30% and 35% of gross. Employer contributions/matching pushes it up to around 35-40%. Single, early 30s.

Not all of that technically goes into "retirement" accounts (401k/IRA), but it is money that isn't spent and probably won't be spent until I retire.
wesleymouch
Posts: 237
Joined: Wed Dec 05, 2012 1:24 pm

Re: What % of your income are you saving for retirement?

Post by wesleymouch »

40% of gross.
Post Reply