# What percentage of your NET income do you save?



## Montrealer (Sep 13, 2010)

I have heard the minimum should be at least 10% and someone people say in order to prosper and build wealth it should be 50% or more. 

I currently save almost 20% of my NET income on a regular basis and want to pay off some debt and start saving more in a HISA and/or TFSA.

What percentage of your NET income do you save?


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## brad (May 22, 2009)

I think we've had this discussion here a few times before; my own opinion is that percentages are meaningless standards because if you earn, say, $12,000 a year you'll be able to save a much smaller percentage of your net income than if you earn $120,000 a year. And everyone's situation is different.


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## FrugalTrader (Oct 13, 2008)

Here's a poll we did on MDJ that had over 1000 responses:

http://www.milliondollarjourney.com/poll-what-is-your-gross-income-and-how-much-do-you-save.htm


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## the-royal-mail (Dec 11, 2009)

My response may be a bit irritating to you and I'm sorry about that. But I don't think iof it in terms of a %. I look at the year ahead based on what my excel sheet shows me I will have as surplus cash in 3, 6 and 10 months. I also have a wish list of things I wish to accomplish in the coming year. For example, dental work, new car, save for TFSA, fortify my 3-tiers of savings buckets, trip to the states, major car repairs and such. Everyone will have different short term goals. I then look at this wish list and compare it against the money saved or to be saved and see when I will have money to do the various things I wish to do. Savings are but one portion of my net income utilized and the amount I can save each year really depends on whether something of a higher priority comes up unexpectedly. In 2010 for instance, the only thing I will end up saving for will be 2011 TFSA. The rest of my net income (as it was saved in tier 2) quickly went out the door to pay for a new car. Next year I am planning for that to be a saving year but if a house purchase should occur then that idea will be shot as well. It's pretty difficult but I am at least trying. Sorry I don't have a nice simple % figure to offer you. Too many things happen and change every year and there's no consistency.


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## slacker (Mar 8, 2010)

Depends on how you define savings.

My net paycheque breaks down like this:

26% - Retirement portfolio (max out RRSP)
30% - housing (saving up for down payment)
20% - current rent
10% - transportation (gas, repairs fund, insurance, 407)
5% - untracked expense (eating out, random shopping, household, expenses)
5% - medium term fun (vacation fun, toys, etc)

*i rounded, so it doesn't add up to 100...


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## steve41 (Apr 18, 2009)

This is a very misleading question. People save at different rates at different points in their career. Remember, your paycheck doesn't grow at the rate of inflation.... career advancement, merit raises.... these have the effect of having much larger 'spare cash' around in late career than in early.

Plus... those early on have kids to bring up, mortgages to pay down. Once they are past their mid-forties, then they can start to save in earnest. To ask the question without specifying where they are in time, makes no sense.


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## Square Root (Jan 30, 2010)

Totally agree with Steve. At the extreme (retired person like me) savings doesn't have much meaning as I spend all my pension and dividends.


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## furgy (Apr 20, 2009)

Montrealer said:


> some people say in order to prosper and build wealth it should be 50% or more.


"Those people" have never tried living on minimum wage , or raising a family , or they're still living with their parents.


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## Jon_Snow (May 20, 2009)

61%

Considering that we carry a mortgage in the real estate bubble capital of North America, it really is a minor miracle that we can do this. No kids helps too.


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## KaeJS (Sep 28, 2010)

I save as much as I can at all times.

Sometimes this is 80%.

Sometimes it is 0%.

Depends on way too many factors. 

Currently, I am saving about 50%. ( I live with my parents )
And 50% is not enough because I don't make a substantial amount of income.

It depends what you want out of life, also.

I would not necessarily like to retire young. I dont plan to retire until at least 60. However, I would like to be able to have lots of "Disposable Income". Disposable Income can only come later in life if you save when you're young. (or get a kick *** job, of course)


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## m3s (Apr 3, 2010)

50%+ of net

No kids though haha.


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## John_Michaels (Dec 14, 2009)

...varies, right now 70%~80% of net. Factors include; only 1 kid, early 40s, no mortgage. This 80% does not include DB pension (not that I have one), but includes DC Pension, company DC match and savings match. Also includes dividend re-investment (as income includes dividends). AND, most important, household income is >$200K per annum. As someone pointed out earlier, saving this amount is easier with a higher salary.

As for am I saving too much? I suppose I could have the cottage, the beemer, the trips to Disney, the_ succesful_  lifestyle - I'd like them. BUT, I like the thought of early retirement better. One of my favourite books is the Millionaire Next Door.


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