The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: Zola. on December 13, 2017, 03:18:19 AM
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Just curious as to how you all split your monthly pay. At the moment I am trying to make this more efficient. I know I probably need to improve this and would appreciate your thoughts. My wife and I earn basically the same wage on average..
15% of my monthly pay goes into private pension
10% of my wife's pay goes into private pension
10% of combined monthly pay goes into mortgage overpayment fund
8% of combined pay goes into a separate Vanguard index funds account
So thats 32% invested and 10% into mortgage overpayment.
The rest is used up on fixed bills really (mortgage, bills, 7% shamefully on paying off a car over the next 3 years, I know... I know!!).
Our actual cash account doesn't grow much each month at the moment due to the above, but we are ok with that. We have enough to cover emergencies etc.
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we are in the states but I'll bite. This is our plan starting in Jan
21.8% into DH work retirement plan (401k)
(8% work match/contribution into same plan)
6.5% into DH personal retirement plan (IRA)
6.5% into my personal retirement plan (IRA)
6.4% into family health plan (HSA)
(1.8% work contribution into same plan)
So 41.8% over our gross and another 9.8% in work contributions in gross percentages. I guess that's 51.8% total.
(Technically if you add in work contributions to gross the percentages are more like 37.4% us and 8.9% work... so 46.7% total.)
31.3% of gross is essentials we'd pay no matter what
26.9% discretionary (fun, irregulars, vacation, donations etc)
2018 goal is to lower essentials and discretionary a bit but more to up donations then to up savings (DH's work has a charity match up to 5K I want to take advantage of). So I guess discretionary will shift more than lower.
Edit: taxes should be almost nothing since we put so much in differed accounts
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When we did our first two annual reviews, we found that our cash was within a couple of hundred dollars year to year without any effort to make it so. This really just means you have an efficient plan that does not require you to shuffle your funds.
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Fun!
These percentages are of gross pay:
13% to taxes
14% to pretax retirement
29% to after tax savings
9.0% to charity
64% of gross pay is diverted out of my hot little paws.
Leaving 36% of gross to live on, with 10% of gross going straight to rent.
Like ixtap, my yearly spending matches within 1k, with no fiddling required. Good enough for me.
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I like to divide my resources into Taxes, Savings, and Living. There's a lot of nuance in the breakdown but these are my rough numbers:
14.6% Taxes
37.3% Savings
48.1% Living
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Taxes are what they are (looks like this year's withholding is around 21%). The rest of the process is:
1) Max out 401k: 17%
2) Spend what I spend
3) Sweep the remainder into investments (leaving $1k buffer in checking) - fill up Roth IRA first, the rest to taxable acct
I have a fully funded EF, so my cash doesn't increase month over month at this point.
For 2017, the averages through Nov for #2 and #3 are spending 23% (+taxes=44%) and saving 39% (+401k=56%).