Do you save all your raises?

[Lonewolf]

One of my 2007 New Years Resolutions is to take my annual raise (anywhere from 3-7%) and begin putting that directly into a Roth IRA account. Just wanted to get a feeling from the board, when you get raises do you immediately put that towards longterm/shortterm savings? In the past, I've always felt there was something else I needed that money for, but I've learned from these boards that the more you have the more you spend if you don't watch it carefully.

Heres to a fully funded Roth starting in 2007!

Wolf

[creditcardfree]

I think your idea is a great one. Ideally, that is how we all should handle raises.

We just moved for my DH's job, the increase in pay does go to our retirement, kids college and extra on our mortgage payment. Mortgage payment also increased, but we are paying extra on the mortgage too.

We didn't really increase our day to day spending by that much.

[rduell]

I wanted to do that with my raise this year, but felt it was more important to get the credit card debt paid off first. Hopefully next year that will be done and my raise can go right into my IRA instead.

[Gruntina]

Mine went to paying of debts but also had to pay for a new generator for the house. Its on the mountains so its crucial that we have one working for a back-up.

[Beccagold]

For each raise DH or I get, we up our 401k contribution by 1%. Then we budget extra into savings.

[PrincessPerky]

this last one went to more food, more phone, and some saving. (each month)

next one is planned as of now to go to life insurance and car payoff prolly a night out to celebrate month one though

[LivingAlmostLarge]

We don't know what DH's raise will be, but it's going straight to paying for his schooling. We've been barely scraping by paycheck to paycheck because of his part-time MBA costs. Granted, I probably should not have listened to him and saved 15% into ESPP and maxed out retirement, we'd be less stressed out. BUT this raise will pretty much ease our personal living situation for the better.

[disneysteve]

What's a raise?

[lrjohnson]

I'm glad in some ways I used to be very low income (part time and minimum wage and paying debt at the same time). I got used to light spending. As my income has gobe up, my spending hasn't gone up nearly the same. I've gotten three promotions and additional raises over the last few years, but I'm still used to spending not-too-much. Being broke was a great gift in some ways; prior to that I always spent all my money.

This year, while on the Challenge, my gross income went up 15% while my spending dropped 35%.

[cptacek]

Before this year, I would up my 401k contribution by half the raise. So, if I got a 4% raise, I would up my 401k contribution by 2% the rest would go to my bank account. Of course, that money usually goes to loans, so my COL didn't raise much.

I'm at the limit on 401k now, though, so I'll probably set something up to automatically siphon off half of the raise to an investment goal, aside from the others I already have. I guess I feel if I use that half for something I was planning on doing anyway, it isn't giving me quite the bang for my buck.

[bjl584]

My raise will be going to paying off my Home Equity Line. That is my top priority for 2007.

[aurielle]

I'm supposed to be getting my review tomorrow. My raise should be in effect starting with my next paycheck. My COLA will be reflected in this paycheck. I set up my account to auto-deduct my COLA and put it into my Roth.
My raise is all going into my EF until I get it to 3 months worth of income, then it all goes into my Roth.

[DivaJen]

I'm happy to say that with the last raise, we are saving about 75% of it, sending the other 25% as extra to the car payment. It's a balance we feel comfortable with.

[JanH]

This is the first time we've saved the raise. It's going into the retirement accounts for co-match. We lost some future retirement benefits when we changed companies, so the difference in wages is being put into retirement. This company co-matches at a higher percentage so it will turn out okay. Being on this site helped me see Hubby's side of the conversation when we changed companies. I understood more where he was coming from.

[veronak]

Actually I just started this concept with my unexpected raise in October, now I am due for a raise this month and will do the same thing

[PRICEPLUS]

Iin the past any raise went for paying off debt. Now a great deal of it will be going into savings.

[sarah]

People really do get raises? really, how quaint.

Originally Posted by disneysteve

What's a raise?

it's generally a laughable, not quite inflation equaling cost of living adjustment given to subsistence wage earners so we feel we've accomplished something and will keep grinding for our taskmasters.






I do save mine in a sense that I don't increase my spending habits when I get a raise, not intentionally anyway. they just make it a little easier to stay focused on the savings goals.

maxing a Roth pretty much in itself puts me at the 15% to retirement guideline I see so often cited, but I'd like to do a little to my 401(k) as well and get that closer to 20%.

[Diolla]

My direct deposit is set up on a percentage so it automatically puts more in my savings.

[autoxer]

I got a 3% raise this year & increased my 401k contribution from 5% to 10%.