Savings % Target 2016?

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WorkToLive
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Re: Savings % Target 2016?

Post by WorkToLive » Sat Jan 02, 2016 11:01 pm

Aiming for 25% of gross here.

IMD801
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Re: Savings % Target 2016?

Post by IMD801 » Sat Jan 02, 2016 11:11 pm

55% gross.

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TXJuice
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Re: Savings % Target 2016?

Post by TXJuice » Sat Jan 02, 2016 11:27 pm

I'm hoping to make it to ~50% of gross between 403b + match + Roth IRA + Taxable + saving for down payment for a house/condo in March 2017. Hopefully the market cooperates more than it did my first year of investing...

GoldenFinch
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Re: Savings % Target 2016?

Post by GoldenFinch » Sat Jan 02, 2016 11:50 pm

This year it will be 45% of gross income all set on automatic.

Probably over saving, or is that not possible. :happy

slowbutsteady
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Re: Savings % Target 2016?

Post by slowbutsteady » Sun Jan 03, 2016 7:49 am

Planning for 20% of gross. Applying the rest to clean out all debt excluding mortgage.

Wishing us all a financially successful 2016! :sharebeer
The tortoise wins every time I read that story.

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avenger
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Re: Savings % Target 2016?

Post by avenger » Sun Jan 03, 2016 7:55 am

25% gross toward retirement
25% gross toward debt reduction

Just like 2014... and 2015. Planning to be debt free in 2017 or 2018.
cheers ... -Mark | "Our life is frittered away with detail. Simplify. Simplify." -Henry David Thoreau | [3 fund portfolio: VTI, VXUS, SV fund (yield 3.01%)]

grettman
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Re: Savings % Target 2016?

Post by grettman » Sun Jan 03, 2016 8:10 am

jjface wrote:
Purelife304 wrote:
scubadiver wrote:20-25% of gross, not counting employer match to retirement savings.

EDIT: Only on this forum would that put me at the low end of the savings spectrum.
I hear you here. Nothing like the BH community to make me feel like a slacker.
Try the MrMoneyMustache forum and you will feel even worse!

Put me in the slacker category (or as a MMM'r would say, "I need a face punch.")

25% of gross for me.

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wander
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Re: Savings % Target 2016?

Post by wander » Sun Jan 03, 2016 8:59 am

30% is lowest threshold.

crg11
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Re: Savings % Target 2016?

Post by crg11 » Sun Jan 03, 2016 9:01 am

Looks like somewhere around 30%.

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AJTrenkle
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Re: Savings % Target 2016?

Post by AJTrenkle » Sun Jan 03, 2016 9:31 am

I know we could probably start a whole new thread on how we calculate this but I include mandated pension savings, retirement accounts, and property principal on our home and a rental property. With all that it comes to 29% Pretax.

I thank this forum for so much, I have been able to reduce expenses in a variety of ways, and become smarter about taxes. I feel blessed. Best wishes in 2016 to all.

awval999
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Re: Savings % Target 2016?

Post by awval999 » Sun Jan 03, 2016 9:42 am

This is like:
Going to the bodybuilding forum and only being able to bench 120 lbs
Going to the Lego forum and only getting 3 new sets for Christmas
Going to the miles forum and only planning on getting 4 new Airline credit cards and one hotel status run
Going to the gardening forum and only planting 3 new trees this year

Always inadequate :shock:

I always enjoy internet forums, because with every hobby you always get to see the 1%ers of that hobby.

Darion
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Re: Savings % Target 2016?

Post by Darion » Sun Jan 03, 2016 9:58 am

47% gross
Last edited by Darion on Sun Jan 03, 2016 10:18 am, edited 1 time in total.

awval999
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Re: Savings % Target 2016?

Post by awval999 » Sun Jan 03, 2016 9:58 am

In regards to counting employer matches:

I truly think it makes sense to only include them in the numerator as savings and exclude them in the denominator (ie: do NOT add them to your gross income).

Here's an example. Let's say I work at AmazingCorp and make $100k and they truly have an amazing 401k at they make a matching contribution of $1 per $1 up to the maximum $18000 of contribution. So I max out the 401k.

The disagreement is am I saving?
$18k+$18k / $100k = 36%
OR
$18k+$18k / $118k = 30.5%

However, without making MY initial contribution, I would never see the extra $18k from AmazingCorp. The intent of saving is to, at retirement, be able to replace all or part of ones salary. That is why we're doing the calculation. But I never made $118k? I cannot. My salary is only $100k. So why am I trying to replace $118k of yearly income? Why would I be using a saving percentage ratio of a salary I never made?

Let's say the only option in AmazingCorps 401k is AmazingCorps stock I hate it because whatever. So I invest outside of the 401k in a Roth IRA. Are we saying that I must divide $5000 by $118k (because I COULD have had the match?). Of course not.

Edit:
What sound more normal?
Statement 1: I am saving 36% of my gross salary
Statement 2: I am saving 30.5% of my gross salary divided by my gross salary plus my employer's matching contributions

What one sounds ridiculous?

I suppose one could use the term "total compensation" but then you best be better adding in your social security matching contributions and your health care contributions into that denominator.

hbgpharmd
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Re: Savings % Target 2016?

Post by hbgpharmd » Sun Jan 03, 2016 11:19 am

Per my IPS, my yearly goal is to save 50% of each year’s after-tax income. I calculate this percentage as

amount saved in all accounts (IRA’s + taxable) / (net pay, including Simple IRA contribution)

For tax year 2015, 50% net savings = 37% gross savings

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Just sayin...
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Re: Savings % Target 2016?

Post by Just sayin... » Sun Jan 03, 2016 12:17 pm

>35% of gross including back-door Roths, 401k, deferred compensation, brokerage purchases and company stock purchase plan. Number does not include any profit sharing contributions, interest, dividends or other investment returns.

nelson1015
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Re: Savings % Target 2016?

Post by nelson1015 » Sun Jan 03, 2016 12:36 pm

Not to impute bad motives but the OP's posts are unreachable for most people and this seems awfully akin to chest thumping. I'm referring specifically to the comments saving 60% of gross and over 600k gross salary.

After you add federal taxes, state taxes, social security, medical costs, property taxes, etc you get over 40% of gross for most people. Maybe I'm looking at the math wrong? Heck daycare for 1 child is about 5% of gross for me and probably higher for most people. I think posts like these are why some people are turned off by the boglehead community.

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JustinTime
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Re: Savings % Target 2016?

Post by JustinTime » Sun Jan 03, 2016 1:06 pm

Wasn't my intentions, In fact it's been very good conversation from many. I simply was stating my savings percentage goal of around 60% gross and there are others hitting right around there in replies so I'm not sure where you are getting "chest thumping".

Bringing up my gross income was reply to another person who was paying 34% was simply asking how much he made since I made more than normal this year and looks like will pay around 28-30% (The 34% taxes is likely in a state with higher tax % mines only 4.63%) I did have a lot of deductions though so that's what I was brining up my gross to see if he made around the same and there may be area's he could have on taxes like profit sharing, hiring wife and doing Solo-401K etc.
nelson1015 wrote:Not to impute bad motives but the OP's posts are unreachable for most people and this seems awfully akin to chest thumping. I'm referring specifically to the comments saving 60% of gross and over 600k gross salary.

After you add federal taxes, state taxes, social security, medical costs, property taxes, etc you get over 40% of gross for most people. Maybe I'm looking at the math wrong? Heck daycare for 1 child is about 5% of gross for me and probably higher for most people. I think posts like these are why some people are turned off by the boglehead community.

nelson1015
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Re: Savings % Target 2016?

Post by nelson1015 » Sun Jan 03, 2016 1:25 pm

JustinTime wrote:Wasn't my intentions, In fact it's been very good conversation from many. I simply was stating my savings percentage goal of around 60% gross and there are others hitting right around there in replies so I'm not sure where you are getting "chest thumping".

Bringing up my gross income was reply to another person who was paying 34% was simply asking how much he made since I made more than normal this year and looks like will pay around 28-30% (The 34% taxes is likely in a state with higher tax % mines only 4.63%) I did have a lot of deductions though so that's what I was brining up my gross to see if he made around the same and there may be area's he could have on taxes like profit sharing, hiring wife and doing Solo-401K etc.
nelson1015 wrote:Not to impute bad motives but the OP's posts are unreachable for most people and this seems awfully akin to chest thumping. I'm referring specifically to the comments saving 60% of gross and over 600k gross salary.

After you add federal taxes, state taxes, social security, medical costs, property taxes, etc you get over 40% of gross for most people. Maybe I'm looking at the math wrong? Heck daycare for 1 child is about 5% of gross for me and probably higher for most people. I think posts like these are why some people are turned off by the boglehead community.

I suppose where I'm going with this is looking at some salary levels and what exactly it would take to save 60% of gross. Hypothetical family making 100k, 120k, 160k or 200k a year? What would taxes, medical costs, housing costs etc have to look like for that to happen? Again, my point is that I believe it to be out of reach for almost the entire population. However, it's interesting to ponder on the subject.

I'm saving approximately 20% of gross in retirement/investing accounts. I have another 9-10% of gross going into principal debt repayments. I could save some additional amounts as approximately 20% or more of gross comes from bonuses/stock options and those funds haven't been received or directed. I think I could bump my retirement gross savings up to 30% without an incredible amount of pain but not much higher due to taxes, daycare, housing and medical costs. I will look at this years taxes closely to see the percentage of gross but won't know that until April 2016.

Nyc1967
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Re: Savings % Target 2016?

Post by Nyc1967 » Sun Jan 03, 2016 1:29 pm

We are set-up for 20% pre-tax plus 6% company match for retirement

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ofcmetz
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Re: Savings % Target 2016?

Post by ofcmetz » Sun Jan 03, 2016 1:29 pm

scubadiver wrote:20-25% of gross, not counting employer match to retirement savings.

EDIT: Only on this forum would that put me at the low end of the savings spectrum.


^This is our goal as well. Be careful not to get savings envy by trying to match some other posters rates. They may be living on twice your income or have half of your expenses.
Never underestimate the power of the force of low cost index funds.

MrNewEngland
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Re: Savings % Target 2016?

Post by MrNewEngland » Sun Jan 03, 2016 1:33 pm

awval999 wrote:In regards to counting employer matches:

I truly think it makes sense to only include them in the numerator as savings and exclude them in the denominator (ie: do NOT add them to your gross income).

Here's an example. Let's say I work at AmazingCorp and make $100k and they truly have an amazing 401k at they make a matching contribution of $1 per $1 up to the maximum $18000 of contribution. So I max out the 401k.

The disagreement is am I saving?
$18k+$18k / $100k = 36%
OR
$18k+$18k / $118k = 30.5%

However, without making MY initial contribution, I would never see the extra $18k from AmazingCorp. The intent of saving is to, at retirement, be able to replace all or part of ones salary. That is why we're doing the calculation. But I never made $118k? I cannot. My salary is only $100k. So why am I trying to replace $118k of yearly income? Why would I be using a saving percentage ratio of a salary I never made?

Let's say the only option in AmazingCorps 401k is AmazingCorps stock I hate it because whatever. So I invest outside of the 401k in a Roth IRA. Are we saying that I must divide $5000 by $118k (because I COULD have had the match?). Of course not.

Edit:
What sound more normal?
Statement 1: I am saving 36% of my gross salary
Statement 2: I am saving 30.5% of my gross salary divided by my gross salary plus my employer's matching contributions

What one sounds ridiculous?

I suppose one could use the term "total compensation" but then you best be better adding in your social security matching contributions and your health care contributions into that denominator.

There's an option three. Even though it's not mathematically correct you're actually living on $82k / year. So you're saving $36k while living on 82k.

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ofcmetz
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Re: Savings % Target 2016?

Post by ofcmetz » Sun Jan 03, 2016 1:35 pm

awval999 wrote:This is like:
Going to the bodybuilding forum and only being able to bench 120 lbs
Going to the Lego forum and only getting 3 new sets for Christmas
Going to the miles forum and only planning on getting 4 new Airline credit cards and one hotel status run
Going to the gardening forum and only planting 3 new trees this year

Always inadequate :shock:

I always enjoy internet forums, because with every hobby you always get to see the 1%ers of that hobby.
Haha, so true. I'm just happy for those who can and or wish to do more than me. I refuse to try to compete with the best though.
Never underestimate the power of the force of low cost index funds.

LiterallyIronic
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Re: Savings % Target 2016?

Post by LiterallyIronic » Sun Jan 03, 2016 1:39 pm

My fiancee and I are shooting for at least $21k into retirement out of $73k combined gross income. That's 28%. Based on my calculations, that should leave us with about $1,400/month excess after expenses, which we can put toward a house down payment or other goals.

awval999
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Re: Savings % Target 2016?

Post by awval999 » Sun Jan 03, 2016 1:46 pm

MrNewEngland wrote: There's an option three. Even though it's not mathematically correct you're actually living on $82k / year. So you're saving $36k while living on 82k.
Interesting.

$36k / $82k = 44%. You'd be saving 44% of your "what". Taxable income? I think that'd be the best term. "Usable salary"? Makes the savings amount look even better!

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triceratop
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Re: Savings % Target 2016?

Post by triceratop » Sun Jan 03, 2016 1:51 pm

nelson1015 wrote:
JustinTime wrote:Wasn't my intentions, In fact it's been very good conversation from many. I simply was stating my savings percentage goal of around 60% gross and there are others hitting right around there in replies so I'm not sure where you are getting "chest thumping".

Bringing up my gross income was reply to another person who was paying 34% was simply asking how much he made since I made more than normal this year and looks like will pay around 28-30% (The 34% taxes is likely in a state with higher tax % mines only 4.63%) I did have a lot of deductions though so that's what I was brining up my gross to see if he made around the same and there may be area's he could have on taxes like profit sharing, hiring wife and doing Solo-401K etc.
nelson1015 wrote:Not to impute bad motives but the OP's posts are unreachable for most people and this seems awfully akin to chest thumping. I'm referring specifically to the comments saving 60% of gross and over 600k gross salary.

After you add federal taxes, state taxes, social security, medical costs, property taxes, etc you get over 40% of gross for most people. Maybe I'm looking at the math wrong? Heck daycare for 1 child is about 5% of gross for me and probably higher for most people. I think posts like these are why some people are turned off by the boglehead community.

I suppose where I'm going with this is looking at some salary levels and what exactly it would take to save 60% of gross. Hypothetical family making 100k, 120k, 160k or 200k a year? What would taxes, medical costs, housing costs etc have to look like for that to happen? Again, my point is that I believe it to be out of reach for almost the entire population. However, it's interesting to ponder on the subject.

I'm saving approximately 20% of gross in retirement/investing accounts. I have another 9-10% of gross going into principal debt repayments. I could save some additional amounts as approximately 20% or more of gross comes from bonuses/stock options and those funds haven't been received or directed. I think I could bump my retirement gross savings up to 30% without an incredible amount of pain but not much higher due to taxes, daycare, housing and medical costs. I will look at this years taxes closely to see the percentage of gross but won't know that until April 2016.
It's possible for some people on the other end of things too, those who are just starting out and have few expenses. When I said I would save 50% of gross, that's on a $36-44k salary. Taxes (11% gross), medical costs (0% gross), housing costs (17% gross), all look pretty good. It's doable, if you don't need to spend money in order to enjoy living life. This isn't trying to live a MMM life, this is just ending up with more money than one knows how to spend at this point in life.

At the same time I realize it can't and won't last forever and more "realistic" savings goals will need to be set in the future.
Last edited by triceratop on Sun Jan 03, 2016 1:52 pm, edited 1 time in total.
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JustinTime
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Re: Savings % Target 2016?

Post by JustinTime » Sun Jan 03, 2016 1:52 pm

nelson1015 wrote:
I suppose where I'm going with this is looking at some salary levels and what exactly it would take to save 60% of gross. Hypothetical family making 100k, 120k, 160k or 200k a year? What would taxes, medical costs, housing costs etc have to look like for that to happen? Again, my point is that I believe it to be out of reach for almost the entire population. However, it's interesting to ponder on the subject.
Agreed, I'm lucky my wife and I don't have any debt and we have no kids yet so that helps savings.
Last edited by JustinTime on Mon Jan 04, 2016 6:52 pm, edited 1 time in total.

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bostondan
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Re: Savings % Target 2016?

Post by bostondan » Sun Jan 03, 2016 2:25 pm

I'm shooting for somewhere around 40%+ of gross pay.

To be honest, I don't like to budget or limit myself too much. I already save more than I'll need to retire early, so I just save whatever is left each month. I live a reasonably frugal life, so it isn't hard to save even while spending however I like. When I actively budget or shoot for a specific saving target it stresses me out and makes me feel like I'm not living my life.
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Candor
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Re: Savings % Target 2016?

Post by Candor » Sun Jan 03, 2016 8:52 pm

42% of gross. I don't think I would save so much if I didn't hate my job so much. Early retirement is a good motivator for me.

jbourne99
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Re: Savings % Target 2016?

Post by jbourne99 » Sun Jan 03, 2016 9:49 pm

I don't really have a target but:
2015 - 93% of gross income
2016 - will probably be around 94%

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LowER
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Re: Savings % Target 2016?

Post by LowER » Sun Jan 03, 2016 11:16 pm

......
Last edited by LowER on Sat Dec 10, 2016 10:25 pm, edited 2 times in total.

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LowER
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Re: Savings % Target 2016?

Post by LowER » Sun Jan 03, 2016 11:26 pm

jbourne99 wrote:I don't really have a target but:
2015 - 93% of gross income
2016 - will probably be around 94%
Holy MMM Batman! How how have you done this?

jbourne99
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Re: Savings % Target 2016?

Post by jbourne99 » Mon Jan 04, 2016 12:36 am

LowER wrote: Holy MMM Batman! How how have you done this?
My apologies. I thought the number seemed abnormally high especially considering the other posts. I forgot about the tax man :oops:

The tax man brings me down to 66% :(

I'm not quite at the level of spending as Mr. Money Mustache but I'm doing ok. I'm just a childless single working professional who has managed to avoid lifestyle creep.

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Re: Savings % Target 2016?

Post by SRenaeP » Mon Jan 04, 2016 10:24 am

A mere 30% of gross (doesn't include employer match). Since the rest of the Bogleheads make me feel like some sort of slacker, I will offer some defense. :-) We recently refi'ed to a 10 year mortgage (from a 30 year) and are still paying extra in order to have it paid off in a little more than five years.

-Steph

nanoanalyzer
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Re: Savings % Target 2016?

Post by nanoanalyzer » Mon Jan 04, 2016 10:33 am

Somewhere around 50% of gross, including matches. More if you count HSA pass-through.

Going to be an interesting year with a new job necessitating a day per week of daycare, a change in strategy on student loans entering repayment, needing a new car, and racing to put together another 30-50k for a house, all the while using HSA contributions to stay in the 15% bracket.

Inspired by this thread, I think I'll go back and check how I did the past few years. Probably not great in the early '10s with ~$25k/year going to student loans... Might never save better than 2015 on a percentage basis.
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2Birds1Stone
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Re: Savings % Target 2016?

Post by 2Birds1Stone » Mon Jan 04, 2016 10:34 am

For 2015 I saved 75% of my net income (counting 401k/HSA in that amount) which worked out to 55% of gross.

The goal is to do the same or better this year.

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alpenglow
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Re: Savings % Target 2016?

Post by alpenglow » Mon Jan 04, 2016 11:51 am

I'm aiming for 55% this year.

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JDCarpenter
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Re: Savings % Target 2016?

Post by JDCarpenter » Mon Jan 04, 2016 1:32 pm

50% of Gross, m/l, is what we'll likely save, although it would be too strong to call it a "target." (Double professional couple with kids off the payroll and shooting for 2017 retirement)
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jhfenton
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Re: Savings % Target 2016?

Post by jhfenton » Mon Jan 04, 2016 1:51 pm

It will depend on how quickly my wife finds another job, but if she found a job making what she was before, the target would be about 35% of gross. We were on pace for that last year through June, but after she lost her job of 14 years, our savings rate declined tremendously (not to mention our gross income declining by about 40%).

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Meg77
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Re: Savings % Target 2016?

Post by Meg77 » Mon Jan 04, 2016 2:06 pm

43% of guaranteed comp gross toward financial goals

(11% to additional mortgage principal payments, 8% brokerage, 6% cash, 16% retirement, 2% HSA).
"An investment in knowledge pays the best interest." - Benjamin Franklin

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packet
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Re: Savings % Target 2016?

Post by packet » Mon Jan 04, 2016 2:39 pm

... so many high numbers...

Guess I need to hold some savings back so I can stay true to my signature.

:beerCheers,
packet

PS,
~27%
I'll content myself with believing those posting higher numbers are just lying, because internet... :)
First round’s on me.

DVMResident
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Re: Savings % Target 2016?

Post by DVMResident » Mon Jan 04, 2016 2:46 pm

Weighted targets to pre- and post-tax buckets

Salary: 25%
Plus company match
Plus RSUs/options
Plus 7.2% mortgage principle pay down, which is on schedule but not counting sales costs (there was considerable debate in another thread if this counts as savings-I'm on the count it side)

All in all, we're a hair shy of my ideal of 1:1 savings to spending. Pretty good though :beer
Thanks Bogleheads, especially about the mega-backdoor ROTH IRA tip.

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akblizzard
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Re: Savings % Target 2016?

Post by akblizzard » Mon Jan 04, 2016 2:55 pm

We save a little North of 25% of gross, will stay the course for 2016. Most of my net pay goes toward expenses related to goofing around, beer, and motorcycles. The rest is wasted. :happy

PugetSoundguy
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Re: Savings % Target 2016?

Post by PugetSoundguy » Mon Jan 04, 2016 2:56 pm

Looks like there will be a lot of rich folks in the graveyard! Your heirs thank you.
:sharebeer

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JustinTime
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Re: Savings % Target 2016?

Post by JustinTime » Mon Jan 04, 2016 4:29 pm

Haha :D Hopefully more on the lines of a lot of early retirees :beer
PugetSoundguy wrote:Looks like there will be a lot of rich folks in the graveyard! Your heirs thank you.
:sharebeer

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Re: Savings % Target 2016?

Post by White Coat Investor » Mon Jan 04, 2016 4:32 pm

My target is 20% toward retirement. More likely I'll be in the 30-40% range counting all savings. Given an effective tax rate now moving into the 30%+ range, that seems like plenty to me. That means I'm only living on <30% of gross, counting what I give away.
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EzM
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Re: Savings % Target 2016?

Post by EzM » Mon Jan 04, 2016 4:36 pm

30% towards retirement. 26/m.

Any extra (5-15%) goes to taxable savings for a down payment in the next few years.

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Re: Savings % Target 2016?

Post by 2Birds1Stone » Mon Jan 04, 2016 4:40 pm

JustinTime wrote:Haha :D Hopefully more on the lines of a lot of early retirees :beer
PugetSoundguy wrote:Looks like there will be a lot of rich folks in the graveyard! Your heirs thank you.
:sharebeer
Amen! My SO and I met 5 years ago when we had a combined gross income of $52k/yr.

This year we are on track to hit ~$175k/yr while living as though we still made $52k/yr.

Resisting hedonic adaption and lifestyle inflation to be able to stop working before the age of 40 is pretty darn awesome!!

retiredjg
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Re: Savings % Target 2016?

Post by retiredjg » Mon Jan 04, 2016 4:48 pm

What is this thread about? What purpose does it serve? It makes fortunate people feel good about themselves. And it makes less fortunate people feel like they may not be doing well enough (as if they didn't have enough problems anyway).

Why would anyone ask a question like that? And why would so many people answer it?

I don't get it.

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Re: Savings % Target 2016?

Post by icefr » Mon Jan 04, 2016 5:03 pm

Goal is to save 70% of net income, which works out to about 50% of gross to savings, 25% of gross to taxes, and 25% of gross to spending.

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vitaflo
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Joined: Sat Sep 03, 2011 3:02 pm

Re: Savings % Target 2016?

Post by vitaflo » Mon Jan 04, 2016 5:08 pm

Our target every year is 25%. Our reality every year is around 40%.

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