Saving percentage?

de1amo

İ once read that an ideal percentage to save would be 29pc but it was never explained if this was after pension payments?
İt was also pre-crisis times and i was wondering what people reckon is a sensible amount to save in these times of uncertainty and hardship?

Penelope_Penguin

de1amo wrote: »

İ once read that an ideal percentage to save would be 29pc but it was never explained if this was after pension payments?
İt was also pre-crisis times and i was wondering what people reckon is a sensible amount to save in these times of uncertainty and hardship?

Hello!

Doesn't it depend on how much you earn, how many are in your family, and what your disposable income is?

As this isn't Old Style, I'll move it to the Savings Board

Hi, Martin’s asked me to post this in these circumstances: I’ve asked Board Guides to move threads if they’ll receive a better response elsewhere (please see this rule) so this post/thread has been moved to another board, where it should get more replies. If you have any questions about this policy please email [EMAIL="abuse@moneysavingexpert.com"]abuse@moneysavingexpert.com[/EMAIL].

de1amo

sorry about the wrong post--percentages not amount!

Reaper

That's a bizzarely precise percentage for something that varies from person to person.

I suspect you misread the article as I can't find a reference to it. I did find something that says in 2009 29% of the amount people saved was into savings accounts, the rest being pensions etc. See the PDF here in case that was what you were thinking of.

I would say there is no % that is right for everybody. Decide what your objectives are and save to meet them.

Loughton_Monkey

There is no such thing as an "Ideal Savings Percentage".

Everyone is different. And it depends what you are trying to achieve. Saving for your annual holiday? Saving for retirement? Saving for a first house deposit?........

Life is more about what you spend. If you spend less than you earn, then you are 'saving'. For some people, this saving takes the form of pension saving. For others, it will be ISA's. For many, it is in the form of investing in your own property. All of these will grow at different rates, and have different characteristics. Putting 29% of my income purely into pensions might even breach limits. Putting 29% into Property leaves you penniless at retirement uless you sell/downsize/release equity.

Taking entirely a "Retirement" point of view, then it has been said that around 25% of gross income should be saved. This is very simplistic, based, as it is, on what a 'Final Salary' pension scheme costs (jointly, employee and employer) to provide an income of 2/3rds Final Salary after 40 years work. But this doesn't mean that such people (very rare these days) don't need to 'save' a bit more in ISA's or similar.

Other people might take the view that they should 'save' X% of their income for their wedding. Or for a long-wanted trip to Australia or something. OK, nothing wrong with that whatsoever. And I'm the first to call that 'saving'. However, in the context of Retirement, this very much isn't saving because the money is in fact spent.

So maybe you should sharpen up on what your specific query might have and ask again?

de1amo

Loughton you roughly answer the query i have!
The article wasnt on the net--it was in the 'middle class Mail'- they were talking about saving for the middle class life and into old age!
The only base i maybe havent got covered is saving towards my step- daughter 'maybe' going to a university in a Turkish uni-she is Turkish but only 13 so plenty of time for change in their education system!(and time to save).

-Pension and home purchases i think are covered.Just a bit outstanding on my mortgage on my uk home but i have plenty of equitable assets abroad to cover that if there is still an issue in the 17 years til i am 65 or so. i have an occupational pension that actually pays me now-it is index linked to inflation.

i am saving roughly 1k(44pc) a month so roughly 3 years will see the mortgage paid down.

As you can see i save quite a big percentage and the reason i was asking this question because sometimes i think i am over doing it!

Meadows

Surely there is no ideal %, you save what you can afford.
Some are savers, some spenders, some a bit of both.

"in these times of uncertainty and hardship" If you have them make more effort to save if you can.

Always look for a bargain!
Do you really need it?
Cut back, save for a rainy day!

Depends what you want in the pot at the end of the day.

mr_fishbulb

It is usually said that when you start a pension you should pay in half your age as a percentage of your salary. E.g if you start a pension at 30 then you should pay in 15%. If you start it as 20 then you should pay 10 % (you can see why it's better to start early).

Loughton_Monkey

de1amo wrote: »

Loughton you roughly answer the query i have!
The article wasnt on the net--it was in the 'middle class Mail'- they were talking about saving for the middle class life and into old age!
The only base i maybe havent got covered is saving towards my step- daughter 'maybe' going to a university in a Turkish uni-she is Turkish but only 13 so plenty of time for change in their education system!(and time to save).

-Pension and home purchases i think are covered.Just a bit outstanding on my mortgage on my uk home but i have plenty of equitable assets abroad to cover that if there is still an issue in the 17 years til i am 65 or so. i have an occupational pension that actually pays me now-it is index linked to inflation.

i am saving roughly 1k(44pc) a month so roughly 3 years will see the mortgage paid down.

As you can see i save quite a big percentage and the reason i was asking this question because sometimes i think i am over doing it!

Glad to be of help.

You may find it helpful to develop a spreadsheet for the next 17 years and beyond. Sounds silly, but well worth doing. It will not be anything like 100% accurate, but will give you an overview of your cash flow and 'net worth' leading up to retirement. Should give you a good idea if you will have enough.

The point about your daughter is exactly the point I was making about looking at 'spending'. Her education will celarly require substantial 'funding' and you need to 'save' for it, over and above any longer term savings/pensions etc. you have for retirement.

Good luck.

de1amo

İ asked my wife what the fees are like this morning--unless our daughter is brainless(which she is far from being), university will be free for her. The only people who pay are the rich dumb ones who go to private universities at great cost for certificates that are generally worthless-the entrance exam for university is done in a single universal exam over a broad spectrum of subjects which test the genuine intelligence of everyone equally--if you haven't got the brains you have to go to work or hope your parents are rich enough to go private(these kids are so rich they really never have need to work)!--to me it seems a fair rational system!
The spreadsheet seems a good suggestion-is there somekind of pro forma to get a handle on all the variables that might be considered!-its not straightforward in my case because my assets are here and abroad.

mr_fishbulb

de1amo wrote: »

İ asked my wife what the fees are like this morning--unless our daughter is brainless(which she is far from being), university will be free for her.

Which country are we talking about here?