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Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: RMD on July 24, 2013, 09:27:39 AM

Title: Mathematically challenged
Post by: RMD on July 24, 2013, 09:27:39 AM
I am a bit mathematically challenged...mostly a mind-block, I think.  At any rate, I have a few questions that someone here might be able to answer.

When talking savings rate in percentages do you include your 401k contribution?  And in addition to that, do you also include the company match?  For example, my husband and I save about 25% of our take home pay (some of that goes to max out IRAs).  I contribute 10% to my 401k and my company matches 100% of the first 3% and 50% of the next 3%... my husband contributes 6% with the same company match. 

So, what percentage are we saving?  Or what percentage is being saved, might be a better way to phrase the question.

(I'm probably overthinking this big-time...)
Title: Re: Mathematically challenged
Post by: arebelspy on July 24, 2013, 09:34:28 AM
About to get on a flight, so sorry for the short response.

There's two ways, you can count the whole thing, or pro-rate it for taxes.

Essentially the denominator minus numerator of your savings rate calculation should equal your expenses.

Type "savings rate" here : https://forum.mrmoneymustache.com/search2/ for more details.
Title: Re: Mathematically challenged
Post by: NinetyFour on July 25, 2013, 04:28:20 PM
Hey Arebelspy--

I know you were in a rush when you posted that last comment, but I, too am interested in this topic, and wonder if you could give a more detailed version of your suggestion.

Thanks.
Title: Re: Mathematically challenged
Post by: matchewed on July 25, 2013, 04:30:58 PM
www.mrmoneymustache.com/forum/antimustachian-wall-of-shame-and-comedy/how-do-you-calculate-your-savings-rate/
https://forum.mrmoneymustache.com/ask-a-mustachian/calculating-savings-rate/msg24598/#msg24598
www.mrmoneymustache.com/forum/ask-a-mustachian/probably-answered-already-but-i-can't-find-it-calculating-your-savings-rate
Title: Re: Mathematically challenged
Post by: matchewed on July 25, 2013, 04:33:15 PM
I'm assuming you're using your after tax income as your denominator. What I would do is figure out the actual dollar amount that is going into your 401k. Add that to both your numerator and denominator. Voila savings rate with 401k included.