Comments on: The Proper Rate Of Savings

By: a. palmer jr.

a. palmer jr. — Sun, 17 Jan 2010 15:22:27 +0000

I hope nobody’s using this as a poll of America’s savings. The people who read these articles are probably not close to a cross section of American savers. I know several people close to 50 years old that haven’t saved a cent. I also know some people who’s debts outweigh their savings. I’ve lived well below my means for most of my adult life, doing with less than I could afford and probably have saved much more than average but I haven’t figured it out to a percent. I do know that when you retire, as I have, it sure feels good knowing you don’t have to worry about paying your bills or where your next meal is coming from.

By: Introducing The Frugal Dad Giving Project | Frugal Dad

Introducing The Frugal Dad Giving Project | Frugal Dad — Fri, 14 Aug 2009 10:00:35 +0000

[...] the face and encouraged me to get moving. The first was a comment left on last week’s post, The Proper Rate of Savings. ”Philip” commented, “I’d like to see a post on the proper giving [...]

By: John

John — Fri, 14 Aug 2009 07:59:47 +0000

Having been disabled most of my adult life, I would have told myself to go get part-time work at age 8 and save as much as possible. Then, when I got my first full time job, save 90% and live on 10%.

And no, I don’t get SSI.

By: DDFD at DivorcedDadFrugalDad

DDFD at DivorcedDadFrugalDad — Mon, 10 Aug 2009 05:29:50 +0000

Good post. Proper? Who knows! This is a moving target that will change at different times. I have been at 33% in the best, but I am lucky to do 10% these days. My goal is to return to 20% by the first of the new year and then shoot to return to 33% by the end of next year. I say aim high!

By: Philip

Philip — Sun, 09 Aug 2009 14:25:01 +0000

I’d like to see a post on the proper giving rate.

By: Gretchen

Gretchen — Sun, 09 Aug 2009 00:59:25 +0000

I love the 50% idea in that it kind of shocks people into really thinking deeply about how much money they could really be putting away. If it pushes people to save even 5% more than they are now it has helped them. I also think you have to save in your own way. For example, I almost never go on vacation even though my household income is quite high. I save that money. However, when we bought our most recent home I made sure there was a formal office space in it even though this made us spend a lot more on a house than otherwise. I work at home and can’t have my occasional client see me working in a laundry room or on the living room couch. So my income allows me to make choices like this but I absolutely don’t spend to the limit and anything I spend money on I do with a purpose to making more money. Oh yeah – we’ve bought one new TV in 10 years and that one cost $150. Other people buy TVs for like $2,000!!!

By: Victoria Vargas

Victoria Vargas — Sat, 08 Aug 2009 18:18:25 +0000

I totally agree that the percentage of savings will necessarily vary per person and family. That said, I think 10% is the smallest that makes sense unless someone is living in abject poverty and in that case every penny may need to go to sheer survival. So, that 10% applies to everyone who are able to provide themselves the basic necessities with a little surplus. I agree with Dave Ramsey’s approach, that once you have $1000 short term emergency savings in the bank, you focus every dime you have on getting out of debt. Once debt-free other than mortgage, deposit every dime you can squeeze out of your living expenses into your savings account until you have a min. of 3 mo expenses accrued. Then, in terms of a regular savings percentage you’d put aside after that, I think the person’s age, years until retirement, and other considerations have to be taken into account. At this stage, though, I’d say a minimum 15-20% should go to savings. Given that I’m 47 with only a few years of insufficient savings under my belt, I’m in the category of needing to make up for lost time – so my saving contributions will necessary be a higher percentage than someone in their 20s who put 10% aside since they were young.

By: Generation Y Investor

Generation Y Investor — Sat, 08 Aug 2009 16:06:45 +0000

Everyones situation is different so there can’t really be a set rule of thumb. I think the key is to figure out what your life goals are (ie owning a house, retirement ect) and then save enough that you have a good chance of reaching them.

I’m only 24 and have been saving a large % of my income since I had my first part time job. That was years ago and now I make a good salary and am able to save about 25% of my gross income. I’m currently single so that helps but I also make a great effort to make saving/investing a priority. I don’t deny myself anything I really want but I do realize that it may not be as easy to save a lot in the future when I get married and have kids. I figure I should take advantage of my situation while I still can!

-Gen Y Investor

By: Foxie@CarsxGirl

Foxie@CarsxGirl — Sat, 08 Aug 2009 02:03:25 +0000

No way I can save 50% of my income at 21…. I need it to help pay my living expenses while I go to school, plus supplement my husband’s income to do so. Means all I have student loans for is to cover tuition, not food, books, living expenses, etc. (And I’m STILL looking at a hefty sum for it all…)

I do, however, save around 10%… Or try to, anyhow. I put about 7% of my income into a Roth IRA last year. This year I started to put 4% into a 401(k), company matched, and still try for $1k in the IRA. Harder to do when my emergency fund got sapped (car accident) and I bought another car as a project…

But that’s life, and I’ve got years ahead of me to make up for my living instead of saving. (No, I’m not ignorant of saving, I’m just not willing to ruin my youth with the “right” decisions.)

By: Kevin@OutOfYourRut

Kevin@OutOfYourRut — Fri, 07 Aug 2009 21:26:47 +0000

Marci (17)–I actually agree with you, but I was pointing out why so many people aren’t able to save and why blanket assumptions don’t necessarily hold up in real world conditions.

If you look at the savings statistics (we’re now UP TO 2.-something percent on the national savings rate) there’s something that’s beyond the scope of “ought to” that’s happening here.