So I have a question about "saving." Right now I have 10 bank accounts. I know; crazy but it really works well for saving. Everything goes into the main account and gets distributed to the different accounts for spending and saving via automatic transfer. I am saving for healthcare expenses, car repair, home repair, car replacement, and future down payment. This money adds up quite quick.
So what I am curious about is how you would categorize the "savings" accounts I have listed above (healthcare expenses, car repair, home repair, car replacement, and future down payment)? These are not true "savings" because they are intended to be spent. Some of these (car repair and health care) may not be spent 100% in a year and as such are rolled over to the next year. If I find that I have a ton of money in my car repair over the next couple of years it might get rolled over to car replacement or retirement plan.
Here are the facts:
52% - Living Expenses (mortgage, gas, insurance, cell, fuel, utilities, food, etc)
8% - Student Loans
17% - "Savings" for Future Expenses
10% - Tithing (this will always be part of my budget)
8% - 401k
3% - Retirement matched Plan
2% - Rounding Error/Misc
I make 82k and have 2 kids and a stay at home wife. God bless my wife she is all about saving money and living what I call "Basic and Beautiful."
Anyway, I have found that I am "saving" 8.5k yearly or 17% of my post tax/benefit income for Future Expenses. To me I would not consider that savings; however, if I don't I am only saving 11% of my income toward retirement! Is this the wrong way to look at it? How do you guys manage your "future expenses" like car repair and replacement?
Lastly if you consider future expenses and living expenses as all part of my cost of living then my cost of living is 69%! This seems high. Do you agree?
Let me know what you guys think. Thanks in advance.
-The Dutchman