Comments on: Saving Half Of Your Paycheck

By: danny

danny — Thu, 08 Oct 2009 17:42:33 +0000

I’m 23 and I save 50-55% of my take home pay. As I live in a country that is facing a huge deflationary period and a big correction of a massive property bubble, my main purpose is for a financially safe future with the intention to buy a house with a very little to no mortgage. I own my relatively new car and can now afford a deposit for a new house but will wait out the crash.

By: Alissa

Alissa — Wed, 10 Jun 2009 13:16:22 +0000

Hi,
I realize this is an old post, but I wanted to add a comment:
I think if most of us examined our debts (mortgage, car payment, student loans, credit card payments, etc.), they are probably close to or exceeding 50% of our income. Ours comes in at just below 50% of our income. So what we have done is committed to putting 50% of our income toward debt until it is paid off. So even as payments decline, or things get paid off, we will continue to put 50% of our income toward debt (every other paycheque). Once we are debt-free, including our mortgage, we will then take that same amount of money and invest it. The remaining 50% covers basic living expenses (utilities, food, clothing, etc.). I think if most people did it this way, rather than allowing their lifestyles to inflate as they paid off debt, then it would be easy to live off 50% of your income.

By: Katrina

Katrina — Fri, 05 Jun 2009 21:09:58 +0000

You CAN and SHOULD live on half your income. I graduated from college four years ago. My husband and I have an infant. We live only on his salary. I make just as much as he does but we bank that every month.

I always dismissed the idea of saving lots of money as a dream but it isn’t. If you dismiss it, you’ll never actually work your budget down far enough.

I have passive revenue streams from online content that helps to subsidize our housing payment. Eventually it will pay for it all together. In a few months, we’ll have no car payment. We reduced our food expenses by more than 50%. I work from home and we have no daycare expenses.

All of that was done without sacrificing our way of life. As a matter of fact, it makes life simpler because we don’t worry about money. I know that every dime I make is for me. Not the grocery store, the car company, or anyone else. That makes me happy and it makes work take on a whole new meaning.

By: Kaitlin

Kaitlin — Wed, 17 Sep 2008 17:19:36 +0000

I am doing this right now – and I’m starting out young, so I think you’re right about that. This is my first year working year-round; I’m taking 16 months off of my degree to work for a major corporation, then going back to finish my degree. But I still live like a student. After taxes, 1/2 of one pay cheque pays rent, 1 full pay cheque goes into savings, and the other half pay cheque covers my expenses. Essentially, after housing costs, I live on $650 a month. I don’t feel like I’m suffocating either…just living the way I always have, except now I have a savings account and RRSP savings that are increasing, not decreasing or remaining constant.

By: Kandace

Kandace — Wed, 10 Sep 2008 00:29:20 +0000

My husband and I pay 50% of our takehome to health insurance for our family and his ex-wife, alimony and child support. We are both self-employed. We also tithe 10%. However, we are able to still save about 15% of our gross income. We’ve had our house for about 8 years now on a 15 year mortgage. Once the kids grow up and are through college, we should be free of child support and mortgage payments. Then we can really save!

By: Half of Us Are Living Paycheck to Paycheck | Frugal Dad

Half of Us Are Living Paycheck to Paycheck | Frugal Dad — Tue, 09 Sep 2008 11:01:32 +0000

[...] is to start saving something–any amount you can scrape together. You don’t have to be saving half of your income for your savings plan to be worthwhile. As your savings accumulate you will slowly become less [...]

By: Book Review: Debt is Slavery | Frugal Dad

Book Review: Debt is Slavery | Frugal Dad — Thu, 03 Jul 2008 11:01:03 +0000

[...] written about the 50 Percent Savings Plan before, and when thinking about it I find myself wishing I had a time machine to go back and start [...]

By: Rob in Madrid

Rob in Madrid — Fri, 13 Jun 2008 16:49:56 +0000

When ever this subject comes up everyone complains that they don’t make enough. But I don’t think that’s the point. The point is that we should make savings the first and foremost over everything. When you make savings the main goal all other things fall into place. When you have savings debt is far less scary, savings helps keep Murphy at bay, and as someone said have a substantial cash is the softest pillow they’ve ever had.

By: Andy

Andy — Thu, 12 Jun 2008 23:56:17 +0000

Stupid Student loans! Jaci and I save/invest about 40 percent of our income. We have a mortgage, car payments, entertainment, cable, utilities, electric, food expenses, etc. It has never been a problem for us, I guess. Gasoline prices are making things a little tough to save at this rate, but I think we can make it work if it stays below 5 dollars.

If only we did not have student loans we could save 50 percent like it was a piece of cake. I don’t wish them on my worst enemy!

By: My Dollar Plan

My Dollar Plan — Thu, 12 Jun 2008 02:47:17 +0000

We actually did this for many years after college. Now we’ve been able to scale back and save very little without any negative consequences. I’d recommend it anyone who is young.