### Author Topic: Hypothetical savings rate?  (Read 2909 times)

#### Baylor3217

• Bristles
• Posts: 291
##### Hypothetical savings rate?
« on: August 24, 2013, 01:02:22 PM »
Assuming the following hypothetical, what would the savings rate be?

Monthly
Gross: \$10,000
401k contributions: \$1900

Net take home: \$6000

Expenses: \$2000

\$300 interest earned monthly on savings

What other info do you need?  I'd like to prototype my math to ensure I'm calculating correctly.

#### Inquizator

• Posts: 32
• Age: 36
• Location: Houston, TX
##### Re: Hypothetical savings rate?
« Reply #1 on: August 24, 2013, 01:11:50 PM »
I'd calculate (\$4000 savings + \$1900 401k) / (\$6000 net income + \$1900 401k) = 74.7%

Some people do things a little different, but I have chosen to use net pay and add 401k contributions to both sides of the equation. I also ignore interest gained by my 'stache.

#### KMMK

• Handlebar Stache
• Posts: 1464
• Age: 46
##### Re: Hypothetical savings rate?
« Reply #2 on: August 24, 2013, 01:36:55 PM »
I'd calculate (\$4000 savings + \$1900 401k) / (\$6000 net income + \$1900 401k) = 74.7%

Some people do things a little different, but I have chosen to use net pay and add 401k contributions to both sides of the equation. I also ignore interest gained by my 'stache.

That's how I do it as well.

#### icefr

• Bristles
• Posts: 325
##### Re: Hypothetical savings rate?
« Reply #3 on: August 24, 2013, 04:08:30 PM »
What other info do you need?  I'd like to prototype my math to ensure I'm calculating correctly.

I agree with other posters, but the most important part is that you use the same formula each year so that you can compare the data.