What's my savings rate? Help me math please

[FiguringItOut]

I'm trying to figure out my true savings from 'new money' vs growth.  By new money I mean my regular salary plus any other income or 'found' money.  The thing is, I've moved some of my cash reserves from regular savings to tax deferred accounts and it makes it confusing.

I started tracking my finances in June 2015.
On 6/30/15 my NW was $105.5K.  This included cash, 401K, and IRA.
During the remainder of 2015 I contributed
- $5.5K to IRA (it was a transfer from may savings account)
- $8.6K to 401K through payroll deductions
- $5.5K to HSA through payroll deductions
- $3.6K was 'found' money - old CD which I completely forgot about that I cashed out
NW on 12/31/15 was $128.6K

So the way I see it, I saved $8.6K of 401K, $5.5K of HAS, and $3.6K of CD for total savings of $17.6K.
This calculates to $5.4K of growth to bring it to year end NW of $128.6K (total increase about $23K)
I don't count $5.5K I contributed to IRA since that was part of the initial NW calculation at 6/30/15.
My cash during these six month went from $42.3K to $47.8K.
Assuming $100K income for the simplicity of calculation, what is my savings rate? 
And how do I calculate my rate of return for this period?  $5.5K of growth divided by beginning NW plus $17.7K of savings comes to 4.47%.  Is this correct way to calculate rate of return?

Now for 2016:
I'm starting with NW of $128.6K.  I contributed
- $2.5K to HSA through payroll deductions
- $4.2K to HSA by direct contribution from my checking account
- $7K to 401K through payroll deductions (Job 1)
- $7.6K to 401K through payroll deductions (Job 2) - this is funded through setting my 401K deduction to 80% of my paycheck and then bridging the difference between reduced paycheck and living expenses from cash reserve; this is happening over the last 5 paychecks of the year.
- $5.5K to IRA transfer from my savings account

At November 30th, my NW was $153.8K (total year to date increase of about $25K).
And my cash went from $47.8K on Jan 1st to $38.8K on Nov 30th.
Once again, how do I calculate my savings rate, growth, and rate of return? 
How do I account for HSA contributions that I made directly?  And what about decrease in cash?
Once again, assuming $100K income, though it was less because I was unemployed all of the summer (I had unemployment benefits only for about 6 weeks and my new job pays slightly less than the old), so I'll have to calculate my annual savings rate at the year end when I have all my income info for tax returns.

Thanks

[FiguringItOut]

Anyone?

[MDM]

You might look at http://forum.mrmoneymustache.com/ask-a-mustachian/calculating-savings-rate-49970/.

As noted there, don't worry much about the "savings rate" number itself, but rather how your decisions now affect your future results.

[FiguringItOut]

You might look at http://forum.mrmoneymustache.com/ask-a-mustachian/calculating-savings-rate-49970/.

As noted there, don't worry much about the "savings rate" number itself, but rather how your decisions now affect your future results.

I read that thread.
However, right now, I don't even know how much I"m saving since I move some of my cash into pretax accounts.  I think the change in cash is what's confusing me in term of figuring out my actual savings.

Right now, it is important to me to understand how my savings stack up against my income as I am concerned that I will be dipping further into my cash reserves without realizing it or without replacing it with other assets such as pretax investments.

[tomsang]

There are lots of threads on calculating your savings rate.  I would not count, found money as it was money that you already had not money that you earned and saved.

All new funds invested divided by net income after taxes is the simplistic way of calculating your savings rate. 

It is a rough guide as there is no one exact way of calculating the rate.  The key is to be consistent so you can see how you are doing.  Comparing to others is very challenging as so many people count or don't count things that would be considered income in the denominator.

IE:  If your employer provides a cell phone, subsidizes or pays for your healthcare, gives you a gym membership, provides food, shelter, or any other fringe benefit that you would have to replace when you retire that should go in the denominator as income. 

IE you will see some people saying they have a 90% savings rate, but when you dig in they work on an oil platform, military, etc and are provided food, shelter, healthcare, and virtually everything they need to survive. When they retire they would need to fund these areas.  So if you wanted to use the savings rate to figure out when you can retire you would need to figure out what the value of these benefits are and add them to your income, lowering the savings rate.

It is more of a fun calculation vs. the gospel of retirement. 

Good luck! 

[Zikoris]

You can reverse the equation and go from spending rate if that makes it easier - that's what we do!

We use Mint to track our income and spending very precisely. So, for example, this year we've taken home $82,501 and spent $26,998. That means we spent 32%, for a year-to-date savings rate of 68%.

[FiguringItOut]

It is more of a fun calculation vs. the gospel of retirement. 

Good luck!

You can reverse the equation and go from spending rate if that makes it easier - that's what we do!

We use Mint to track our income and spending very precisely. So, for example, this year we've taken home $82,501 and spent $26,998. That means we spent 32%, for a year-to-date savings rate of 68%.

I agree that it is not a gospel.  I was just trying to figure out if I am saving less than I think. 

Zikoris, I will try to do that and look at it from the opposite side.  I have all my date in YNAB, so I should be able to pull up the numbers fairly easy.   
Thanks for the suggestion.


 

[MDM]

...I am concerned that I will be dipping further into my cash reserves without realizing it....

An equation that applies to many situations is "In - Out = Accumulation".

Treat "In" as your gross income, "Out" as a combination of "expenses" (e.g., groceries, taxes) and "savings" (e.g., 401k contributions), and "Accumulation" as the change in your bank accounts' balance.
Can you get that equation to balance?  For most people that requires a "miscellaneous spending" category because they don't track every dollar, but as long as that category is small (say, 2-3% or non-housing expense) that's good enough.

If you can get the equation to balance, then you know your investment savings and expenses and are all set.

[tomsang]

The other mistake that I see people making is counting their investment returns that are invested as investments or savings.  According to the calculators it is expecting all investment returns to be reinvested.  Therefore you should not count those.  It also makes sense, as it should not matter if you have dividend yields or price appreciation and no dividends. 

[BlueHouse]

I also found it difficult when I had a lot of transfers between accounts. I found that if I keep things very simple, I get better results because my tracking software puts two entries for everything and sometimes I double counted. Now I just have a spreadsheet that tracks income in one column and then one column for each savings vehicle (401k, Ira, brokerage, savings, cd). I don't count savings until my money hits one of my long-term savings vehicles.   Money in my checking account can be spent, but once money hits one of these other accounts, it takes an act of congress to get it out.
Calculations are very simple this way and I don't have to track hundreds of smaller spending transactions.

[FiguringItOut]

So after about an hour of combing through my YNAB, investment accounts, old paystubs, and couple spreadsheets, I gave up to figure out how much I actually saved this year.  My NW is up about 25K this year, so at least I'm moving forward.

I need to come up with a better system to keep track of my records in 2017. 

[Zikoris]

So after about an hour of combing through my YNAB, investment accounts, old paystubs, and couple spreadsheets, I gave up to figure out how much I actually saved this year.  My NW is up about 25K this year, so at least I'm moving forward.

I need to come up with a better system to keep track of my records in 2017.

You can't just get two numbers - year to date income, year to date spending - from YNAB? That's all you need. It should take five minutes, if the transactions are all there.