How much will you have saved by the end of the year?

Lrimas

Ray_Singh-Blue wrote: »

What I find really interesting is the percentage of income saved, as well as the actual amount.

Take Boglehead with his or her massive £124K of saving this year. Assuming this is saving from earned income, and that they are a UK taxpayer, then they must have a huge salary (footballer? banker? although actually from memory I recall maybe said worked for family business)

What I wonder, did Boglehead earn £300K - in which case they have saved about 75% of their net income of £169K after £121K tax and £9K NI.

Or did they earn £700K, in which case they saved about a third of net income, which is still very good but not quite such an acrobatic feat of moneysaving.

Or take someone who is hoping to save £8K. If they earn £13K then they are saving 75% of net income, if they earn £31K then they are saving 33%. To me these figures seem every bit as impressive as Boglehead's - in fact more impressive as there is a limit to how much living expenses can be cut.

Personally - after paying tax, NI and pension contributions- my net income is around £60K. I hope to invest around 30% of net income this year, like I have done for the last few years.

Mathematically, if someone invests 30% each year for a few years then before too long they have several years net income stored in investments. There comes a point at which investment returns start to provide a meaningful income stream & the pressure to work becomes much less- at least, that's what I hope!

According to Mr Money Moustache if you save 30% of your income you can retire in 28 years time. That is way too long for most people.

Remember to add your and your companies pension contribution and to subtract your mortgage payment of you plan to have your house paid off before retirement.

At 60k net you should be able to save much more though (is that household income? What is the size of the household?)

I am personally on 75% with £48k net (but that is only my salary and me and OH share bills so we have a fairly high household income though)

I use the formula:
Savings rate = (savings+pension-mortgagePayment) / (netIncome+pension-mortgagePaymrnt)

bobobski

My net salary is £2,900, up from £2,700 as of July. I keep my signature updated with how much I've saved. I pay £920 pm rent and about £220 pm bills. So net of that I'm saving approximately 40% of my higher salary on average for 2016 (or 25% before rent and bills) if my maths is correct. And this year I had a massive car service and went to a festival (about £600 all in for the latter) which is included in the 60%/75% not saved. And my savings should be going up in a couple of months.

I would be nowhere near this level without the Save 12k challenge. I can't recommend it enough I'm certainly not the best saver on there but last year I saved a grand total of £3k on my own and this year I've more than doubled that with 3 pay days still to go with the challenge.

bobobski

Forgot to mention my quoted salary is net of pension contribution, which I don't count in my savings figures or in the challenge.

Pincher

Saving is a hazy concept these days.

I have to actively spend it, beyond the essentials, just to slow down the growing pile.

I redefine saving as spending less than standard retail price.

I am spending £1,300 on gas and electricity, one year fix versus £1,700 on standard tariff.

Bought a fridge/freezer when John Lewis did a special offer, £1,200 versus £1,500 regular price.

Just fixed a Megaflo (hot water cylinder) pressure problem, by making it true to vertical. Circa £1,500 worth of replacement work saved.

Saving money by denying myself? Not a penny.

waveneygnome

May I blow my own trumpet?
No-one else apart from my accountant and wife knows this.......

jaydeeuk1

Dird wrote: »

The answer to many is here: https://docs.google.com/spreadsheets/d/13i1sj4B3PnNpa-77U9EEGjWMqLiej9W0LGvvBo7vKIY/edit?usp=sharing

Prepare to be jealous of boglehead

Is the spreadsheet excluding pension savings?

darkidoe

jaydeeuk1 wrote: »

Is the spreadsheet excluding pension savings?

People on that thread track their savings with various methods, some include investments, some include pensions, others just pure cash. Personally I track my cash accounts monthly and track the net balance when i want to update record. It is a great community to encourage setting goals and challenging each other to meet them!

My goal personally is to maximize annual S&S ISA contributions as a minimum savings goal. This is proving slightly tight on my current salary. I need to figure out what's going to happen to my pension contributions as well.

Ray_Singh-Blue

Lrimas wrote: »

According to Mr Money Moustache if you save 30% of your income you can retire in 28 years time. That is way too long for most people.

At 60k net you should be able to save much more though.

I am personally on 75% with £48k net

Bingo!

28 years is, incidentally, exactly how many years I will have worked if I retire at around 50 which is my plan. That works well for my family & I have no wish to retire sooner. I'm mostly happy with the balance between how we live now and how I hope to live in the future. So 30% is a good number for me, although for someone else it might not be.

I guess saving 75% of your income means you are hoping to escape the rat race sooner rather than later?

Dird

ambitiouspanda wrote: »

Young girl trying to make something of herself!

The role of Mrs Dird is available :beer:

Lrimas

Ray_Singh-Blue wrote: »

Bingo!

28 years is, incidentally, exactly how many years I will have worked if I retire at around 50 which is my plan. That works well for my family & I have no wish to retire sooner. I'm mostly happy with the balance between how we live now and how I hope to live in the future. So 30% is a good number for me, although for someone else it might not be.

I guess saving 75% of your income means you are hoping to escape the rat race sooner rather than later?

Good point. 50 is a very respectable age to retire and if you've been saving that much since you started working it is more than achievable.

Yeah, I'm aiming for 6-7 years. I've only recently started saving though so will be in my early 40s when I retire.