Post # 16
I’m currently on maternity, my entire maternity cheque (£624/month) is saved and my fiancé pays for our lives. But before I was on maternity we were saving £1000-£1200 a month which depended on the hours I worked.
My fiance earns £1350/month so it was nearly half! We are just good with money.
To spend what we want to we would need to earn double what we currently do but if we carry on saving as we are we will be mortgage free by 35! Which I don’t think is too shabby! In which case we will have an extra £600 a month.
We don’t have any other debt apart from our mortgage. If we can’t afford it we don’t do it! We haven’t been on holiday in 5 years!
Post # 17
My Fiance and I still have split finances so this just applies to me. I’m a recent grad and have been at my job for about 9 months. I don’t have any debt besides my student loans and am currently contributing 11% of my paycheck towards my 401k (including employer match). With my take-home pay, I put away around an additional 21% of my monthly income. This will probably change drastically once Fiance and I get married as he is going to dental school and will have a lot of student loans.
Post # 18
I still live at home and only have to pay for my car and any other expenses such as food and clothing so I save about 75% of my net income monthly. Some months I splurge and end up saving a lot less but I aim for about at least 50%
Post # 19
Living in a HCOL area, we have about $700000 debt (including mortgage on an average house and a 25% share of another house) and need $8000 a month for our basic loan repayments, bills and expenses. This does not include any fun money or going out. We do not get designer anything, we don’t have the latest/greatest anything and we are often ‘broke’ and have no savings other than superannuation.
I honestly don’t understand how people do it and have such large savings. Do you just never go anywhere/do anything? There must be secrets we don’t know about.
Post # 20
ozbee : I am pretty sure a number of the posters are talking about a percentage of whatever is left after they pay their mortgage/car note/utilities.
Post # 21
- Wedding: May 2015 - St Peter\'s Church, East Maitland, and Bella Vista, Newcastle
My husband earns twice what I do (I work in the arts – no one does that to get rich!) and 75% of his pay goes straight into the mortgage. We’ve been in our place for 2.5 years now and if we continue the way we are going, we’ll have it paid off in six years from now (25 year mortgage). Having said that, we do have access to the extra we put into it as a redraw so that’s effectively an emergency fund right there. I put 10% of my pay straight into a savings account, about 65% into our joint account which pays bills, food, basically all our day to day living expenses, and the remaining 25% is my “fun money”, as the remaining 25% of DH’s is his fun money.
Retirement funds in Australia are slightly different – our employers put a sum equal to 9.5% of our pay into a superannuation fund – this is on top of our pay. So that happens without us having to think about it which is nice. You can contribute more but right now we’d like to get the mortgage paid off ASAP so that’s our focus.
Post # 22
katebluestone : I’m curious what posts make you think this as I see quite a few people referring to a percentage of their net income. Typically when people talk about net income, they mean their take home pay after taxes, not the money left over after bills. Many people also likely followed the example given in the OP where she states a percentage based on her take home pay, not the amount left after bills.
ozbee : we are able to save quite a bit due to living in a LCOL area. For example, we have a nice house in a nice neighborhood and paid just under $250k for it. We also have no kids and rather successful careers to the point where we save my entire salary. When we made our move after college we targeted moving to a LCOL area which I know isn’t an option everyone has.
OP: outside of our 401k and Roth accounts we save at least 30% of our take home pay. Typically more as we save my salary and the 30% I referenced is my base pay without overtime or bonuses. We don’t really have any secrets, we just have successful careers in a LCOL area. We also have no debt other than a mortgage. Paying off my student loans freed up quite a bit of money that we immediately started diverting towards savings.
I didn’t see anywhere in your post if you mentioned contributing to your 401k. If you’re not, I highly recommend looking into that and at least contributing enough so you can get your max employer match.
Post # 23
I’m a medical resident so I don’t make a ton of money. My monthly student loan payment is 100$ and then I have been putting 600$ into my “wedding savings account” each month. The rest of my money goes to rent (700$), utilities, groceries and gas.
Post # 24
ozbee : I live in the Bay Area which is a VHOLA so tell me about it, lol. It’s all relative so it depends on whether 8000 per month is a lot to you.
Post # 25
katebluestone : that doesn’t even make sense – who calculates savings that way? Most people I know do everything based off their paychecks, which isn’t perfect depending on any voluntary deductions but it’s a common start. For example I calculated my savings rate off of our net paychecks which doesn’t take into account the pre-tax deductions we have for health insurance, public transit pass, and a dependent care FSA plus our various pre/post tax retirement savings. If you go off of gross instead we save 15% of our gross not counting retirement (which is at least another 15% – I forget how much my husband’s pension is).
ozbee : I’m also in a HCOL area (Boston) and it just comes down to what we all consider “basic and neccessary”. Does your $8k include cable? Do you have a car? What are your groceries like? Obviously there is a point where one can’t trim anymore but usually there are sneaky little budget items that we don’t think to question how much we spend on them.
Post # 26
Darling Husband and I save about 10% per month. We live in an HCOL area and earn moderate incomes. We have very little debt. We rencently bought a house and have been investing a lot of our extra money into some deferred maintenance and upgrades. Once we get those things out of the way I think we will save closer to 20%. This does not include our retirement savings.
Post # 27
mingogo4 : neither of us are on massive salaries, and COL is high where we live. That said, we save £300 a month between us, which is currently 10% of our monthly income after tax/insurance (we don’t save for retirement currently as we have pensions in the UK, and I have a good one (I pay in 6.5% currently and my employer matches it, but I’m looking to increase this to 10%)). The bulk of our income goes on rent/utilities/bills, and we allow £280 a month each for ‘luxuries’ (clothes etc).
We also have a separate holiday fund which we pay a similar amount into. This is really just to make sure we have the money there and don’t spend it on other things, as holidays are pretty important to us.
A lot of people I know can’t save anything at all so I consider us privileged, but unfortunately we are still a huge way off being able to get a mortgage (for a 1 bed in our area we need a £25k deposit).
Post # 28
I know I’m late to the party but why do you put $600 to savings each month if you have balances on your credit cards? Put the savings money towards your debt and pay it off! Debt accrues interest. So your debt increases each month. Once its paid off you can save ALL of that money.
Post # 29
I save 70%+ of my post-tax income.
I grew up lower-middle class and now make a solidly upper-middle class income, so I am lucky. I just kept most of my old habits and didn’t let my lifestyle inflate in terms of material goods. I do pay more for experiences and convenience, though. I live with a roommate and hardly ever buy stuff, but I spend pretty freely on eating out and trips.
Post # 30
I’m currently in the 26-30% bracket. After taxes and the set percentage taken out for my pension, my monthly net pay next goes to half of the rent (relatively HCOL), the gas and electric bills, my share of the family cell phone plan, and my car loan and insurance payments. I use a credit card for most purchases out of convenience but pay the balance off each month. I don’t set aside a certain amount for other purchases; I just buy what I want and still end up adding to my savings. I like to shop, but my tastes are not expensive I suppose.
My SO saves a similar percentage each month and like me does not carry a balance on his credit card, though he has some variations in his financials in that he has a 401k and an investment portfolio. He does have student loans in his name, but his parents are making the payments. He currently doesn’t have a car. His salary is less than mine, but he has more savings because he’s been at his job for over five years and living at his parents’ house for most of the time, whereas I started my job last year and was on a grad student stipend and living alone before that. I also had to eat into my savings a bit for the six months I was unemployed after grad school because I didn’t want my SO paying my way when we moved in together.
A house, and to a much lesser extent our wedding, are the goals for our savings right now. Currently I have around 35% of my annual salary already in savings; my SO has about three times my savings in his.