Source
r/Frugal•
throway

How much do you save?

After reading how much redditors are spending on their rent, I wanted to know -- how much do you save of your income?

My parents always taught me that 50% was the savings rate to shoot for. Right now roughly 30% of what I make. This is obviously high. But how high is it?

EDIT: When I say saving, I also mean safe investments like 401ks, IRAs, CDs, bonds, etc. Dad was a money manager so I definitely know a lot about that kind of thing.

Posted Nov 4, 2009, 10:02 PM UTC · edited

1547
khemphill•

I think that 10% is reasonable. More is obviously better, but 10% is almost always doable, even for people with low incomes.

Right now I'm a student, and I can only afford to save about 10%, because I'm trying to pay tuition without loans.... I'd rather be debt free than have a bunch of savings AND debt.

However, I'd think that the more you can save, the better.

9
omnomnomnomnomnom•

Not when you have to worry about having enough money to eat each week :(

4
EggplantWizard•

Sad, but appropriate username.

2
g1rlb0t•

My husband and I have 10$ per day, total for the both of us after our rent and other bills are paid. That's for food, trashbags, toilet paper, etc. I wish we had money to save, but on one income it's nearly impossible, even with everything we have given up.

1
elustran•

Oddly, having a little savings AND debt can be a good thing. Student loans can be deferred and gotten with reduced interest rates, and your savings can accrue value faster than the interest on your loans. If you then pay back your debt regularly, it will improve your credit and make it easier for you to rent property or take out loans in the future.

0
[deleted]•

I save 50% of my income. If I lost my job, I could keep living the same lifestyle for five years :-)

9
adremeaux•

Ah, but you couldn't, because people who are like us about money (saving/being frugal) can't bear to see it disappear. I could theoretically survive just like you, but I know that in the past even two weeks not making money I start to panic... and I am a freelancer :)

2
[deleted]•

You are of course correct. If I lost my job, I would switch to "low income mode" where I cook pasta rather than eating out, wear clothes even after they're out of fashion, and switch to cheap beer. So I could actually get by for maybe eight years without a job ;-)

3
loonidood•

when i get a check every week, there is no savings, there is only the question, "will this get me through the week?"

if not, then deciding what to do without is the norm.

when my wife gets out of school, things change; because we are getting by on my salary, that would make hers savings, among other things.

for now, one salary is just getting by.

8
[deleted]•

Amen.

5
pleen•

That depends on what I roll.

7
masterJ•

Right now 60+% (after taxes) is going to paying off student loans each month, but in a year that will be my savings rate.

6
joeframbach•

Me too. :(

2
Eurasian-HK•

$2.13 i am frugal with my savings.

5
onmach•

Probably 70+% (edit after taxes). I put it in stocks because I want the money available to be used at the drop of a hat (like to buy a car without a loan). Of course I have no dependents to worry about yet.

I find the biggest thing you can do is ask for a raise once in awhile. For you, a 10% increase in your salary to your company is not a huge deal, but if you are eating 70% of your money now surviving, a 10% raise means you would sock away 33% more money every month. That makes a huge difference.

3
ephekt•

50% is ridiculous because it means you're likely not investing. Max out 401k & IRA contributions before saving. I'd still put some money into mutuals or ETFs as well before saving. But of course, you should have 6-12 months of expenses setup in a money market before investing.

2
throwayOP•

I consider "safe investments" to be saving analogues.

9
ephekt•

Fair enough then. To actually answer your question we currently save/invest about 35%.

2
jhaluska•

I invest 50% of what I take home every month.

2
tehfourthreich•

50% is high. I save none right now, but I think 1/4 to 1/3 would be a good number.

1
[deleted]•

around 27.5%

1
jgarfink•

About 25%. But considering this is my first ever job and I don't get paid as much as I should, I'm pretty proud of myself.

1
BrittSprink•

I don't have a set goal anymore. I used to set a specific amount aside, but I would still have money left over at the end of the month and would just blow it because I had "already saved". I get paid once a month, so now I just spend normally and I use all of the leftover funds at the end of the month for savings.

1
tcpip4lyfe•

Right now 50% because I'm saving for a down payment on a house. Things are pretty tight because of it.

1
dirtymoney•

well, it USED to be about 30-35%. But my income level recently took a nosedive and I dont know yet what it is now.

edit: just got my paycheck today & from my calculations.... I may be able to save maybe $300 a month.... which I think is about 15% (it will vary depending on winter & summer utilities costs)

1
[deleted]•

[deleted]

1
[deleted]•

Save for what?

There are different kinds of savings. There's saving to spend in the somewhat near future. There's saving for your kid's college (if applicable). There's saving for an emergency. There's saving for retirement. Etc. etc. etc. And then there's the "I saved $5 by using a coupon on [insert still ridiculously overpriced, unneeded item]"

In any case, I don't save as much as I'd like because I'm still paying off a lot of debt. However, I have no plans to change my lifestyle drastically when all of that is gone. Assuming income and other expenses don't change, that will be about 40% or more going towards savings. And I'm actually hoping that things I'm doing now will help lower expenses even further in the future. Then again, I'm hoping income will go up, too. Definitely wouldn't be bad if both happened! But I'm not going to push expenses down as low as I could, either, because I want to take care of my health (healthy food is actually a large percentage of my budget and I'm o.k. with that "investment").

1
[deleted]•

This year I've been working my first full-time 'real' job and saving about 40% of my take-home pay (which works out to around 27% of my income before tax, student loan and 2% to a superannuation fund are deducted).

1
cuberail•

About a quarter, but only because it's so darned low to begin with. When I had a decent income I saved about 3/4 of it.

1
PityFool•

35% of take home pay each month, 27% of gross. After enduring 8 months of unemployment last year, I'm very proud of these numbers today.

1