What % of your Income do you save?

[Fern]

How much do you manage to save on an annual basis, and what are you saving it for? Retirement? New car? College?

Me: I am single, 45 and have no children. I do have a mortgage and high ($6,600) property taxes. I save:
5% thru 401k
$50/month thru auto deposit into a mutual fund money market
another 5% of personal savings

and i prepay my mortage $100 extra each month. And i have a very modest income.

To accomplish all this, I scrimp in many ways and keep track of expenses and income on monthly basis.

[CRFSaver]

Hmmm. Never looked at what I was saving percentage wise but here goes.
15% in my 401k
3% company stock purchase plan (15% discount).
600 a month from auto pull into two savings accounts

Then when cash accumulates to much in my checking account I transfer additional moneys over. This happens about every other month and in March when raises, bonuses and tax returns come.

I also purchase individual equities from time to time in little lots of 250-500 dollars through direct purchase programs.

I could probably do a lot better but I dont think I have balanced my check book in 5 years so I always leave a cushion.

[Snoopy2645]

I just started buying savings bonds I am buying two $50 ones every month I am paying my house off this year with my savings so I figure when that is paid for & I have no money in the bank at least I will have these savings bonds in case of emergency until my savings gets built back up. I am an IC so I have no 401k but my main income is from one company if I get paid each month 1 time from another company I use that to buy the savings bonds.

[CRFSaver]

Your heirs are going to hate you when they have to reregistered all those savings bonds. Haha! One of the first jobs I had was getting those things reregistered for estates. I am sure it is a lot easier now but god they were a pain in the butt.

As an independent contractor can't you start a SEP plan?

[marjorie]

Too little. I'm 49,divorced and have worked for local government for 25 years. Will have a pension and ss, but I only have $300 a month taken for 457. Kids are nearly self-sufficient at last, so that's a major relief. Big problem now is house... too much, too old for someone who can't do repairs, either knowedge-wise or chemical-wise due to asthma.

[BCompDude]

I; likewise, have never given a whole lot of thought to percentages but total dollar value. That said:

10% is saved for my tithe to my local church. No matter what.

10% goes to company stock (We get the stock at the lowest point in the last six months plus 15% off of that price)

5% to 401(k) until they end matching

Roughtly 30% to Roth IRA and other equity purchases

Then 10% into my ING accounts.

The rest just goes into my checking account for spending money--but I really just use it for a slush fund.

Those numbers are off of gross.

[Snoopy2645]

I am sorry I am not sure what an SEP plan maybe you can explain it for me. As far as savings bonds I have on all savings bonds the name of who they will go to if I die I am hoping that helps. I am not planning on buying tons just a few until house is paid for then I will start saving seriously again.

[CRFSaver]

A Simplified Employee Pension Plan, commonly known as a SEP-IRA, is a retirement plan specifically designed for self-employed people and small-business owners. Call Vanguard or Fidelity and they can probably send you some literature. You can contribute something like 40K a year to it.

[Snoopy2645]

oh ok Thanks IRA's I know about I had just never heard about a SEP

[baselle]

This calculation is a bit tricky - your 401K/403B/IRA contribution is with pre-tax dollars, Roths and general savings are usually with after tax dollars. To be consistent, I'll calculate it against pre-tax dollars.

Anywhere between 35 - 40 % of my pre-tax monthly pay goes to savings or investment. Depends on how I do that month.

[Fern]

Interesting replies...thanks. Some of you have impressive savings records. I used to sock away 15% in 401k for a number of years, when i was working in a higher paying field, but i traded that in for a job paying $30,000 less -- yes, that's $30,000 less, for a job in my home town (i often walk to work), with no stress, great boss and interesting work. I feel the increase in my personal time and no commute is worth the tradeoff in dollars. And, like i said, i supplement my income with freelance work on the side, which last year grossed another $6K. My goal this year is $10K.

Marjorie, I know the feeling about the house being more than you can handle. I've had mine for 10 years, have always loved it, but sometimes the yardwork and maintenance is just too time consuming. I'm thinking of selling in the next few years, getting a nice condo and investing the remaining profit from sale for long term. Or marrying my boyfriend, whatever works out

[gakline]

Ok, I think I've got some trickiness out of the way. I'm not doing a percentage, too much work.
I save $4000 after tax in my Roth.
Come July 1st (tomorrow) I will be saving 4% in my 401k pre-tax.
Otherwise, I say about $300 a month into savings.

I need to save more though. I could save about $170 more a month, but then I wouldn't be paying down my student loans or house as fast.

[retire@50]

If I include short-term and long term savings I save around 35% of my gross income. I'm also single, 44 and have no children, just well loved nieces

18% in 401K - max out every year.
$4000 in Roth IRA - max out every year.
$8000 in other savings - mutual funds, CDs whatever.
$1800 - new car fund
$1200 - short-term savings fund - currently saving for a vacation next year to Canada

I have a larger house than I need, but since it's close to my nieces I plan to stay here till they get to college. I'm not pre-paying the house mortgage because the interest is only 4.5% for 4 more years and I think I get better returns elsewhere.

[BAGAGT1]

10% Into 401k
5% Into Roth IRA.

I wish I could save more!

[JBinKC]

In the past few years I have been able to save about 45% of my gross earnings in savings thanks to having no debt. Of that amount 20% goes to my 401K which in hindsight has been a dumb decision because the investment choices at work SUCK. I believe I have earned no return on it other than my company match in 11 years.

The reason why I save so much is it appears our standard of living here in the US has been falling by the the minute and if you are not prepared financially I would fear for your mere survival.

[Tree0164]

Hubby puts in 10% of salary into 401k.
I put in $200 monthly into a Roth IRA
We also put in $150 dollar towards college savings

Since my first goal is to eliminate my credit card debt, I put most money towards that. My eventual goal will be 15% of my income to go into savings ~ I can't see it won't be possible, considering the money I pour into my bills at the moment. I don't spend carelessly.

[Tree0164]

Karnic That will be very possible once you pay off the debt.

Fern while rereading this thread. I think that it is wonderful that you made some adjustments in your life regarding your job. Life is much more than money and a job.

[kzz]

We're retired but we still manage to sock away 18% of our pensions due to living below our means. When we were working we managed up to 30% each month. We still enjoy lots of things (vacations, eating out, toys paid for with cash) we just don't NEED to spend what comes in each month.

[ephalba]

15% goes directly into my 403B account; a smaller percentage goes to a 2nd pension plan provided to all employees where I work.
My employer matches my 403B 100% on the first 6% I contribute, so my overall percentage is really higher than 15%.
I have a separate savings account that I am currently working at raising, but unfortunately, have not gotten into the habit of contributing consistently enough to state a percentage.