71.70% savings rate past 12 months

[Davids]

I started calculating my savings rate for the first time beginning May 2015 and with a full 12 months of data I am proud to report I managed a 71.70% savings rate. It feels really good to actually see the results.

As a quick background without revealing the numbers I work full time, we have a one year old son so my wife currently works part time (average 1-2 days a week). For the most part we are fairly frugal so it is nice to be able to actually see the numbers. I do know of larger expenses coming up so I do not expect us to maintain this savings rate over the next 12 months but factoring in the larger expenses and assuming no other major changes this would probably put us at a 66-68% savings rate range for the next 12 months.

In terms of measurements I have not included in my calc (which would actually make the savings rate higher) my employer's 401K match, my employer's $1K annual HSA contribution and my wife's employer 401K match (She still gets company match even at part time).

I am sure there are many others on here who have a higher savings rate but I am very happy with what we achieved.

[wienerdog]

Just wondering why you don't count those as they are savings?  If you switched jobs and they didn't have a 401k match then you wouldn't be saving it.  Do you include your principle if you have a mortgage?

Your numbers are great!  I was at 64% this past month but 51.5% last month because of some upkeep on the truck. Usually average around 55% but I don't include my mortgage principle as I don't consider it liquid or something that I would use in fire.

[Davids]

In terms of why I do not include the company 401K match and HSA contribution in my savings rate I really have no good answer other than when I started I just was not including them. I guess I can look at it is I am managing to save this much without even needing to factor those in.

For my monthly mortgage payment (which is my only debt) I do include the principal in the savings portion (interest in the expense column) but I definitely see a reason for calculation why not to include it.

[forummm]

Nice going! I do include my 401k match. I don't include HSA contributions (because those will be spent on medical care--I also don't include the expenditures when I make them).

[SyZ]

I'm just legitimately confused how you hit a 72% gross savings rate?

That means taxes, rental or mortgage, utilities, gas (if applicable), insurance, food, entertainment (even if small) all add up to 28%

[forummm]

I'm just legitimately confused how you hit a 72% gross savings rate?

That means taxes, rental or mortgage, utilities, gas (if applicable), insurance, food, entertainment (even if small) all add up to 28%

People calculate savings rate in different ways. I don't include taxes or mortgage principle in mine. Taxes are generally unrelated to my spending habits (almost strictly a function of income) and I won't be paying them (or very little) after RE. And repaying a loan is just another form of saving (you previously bought whatever it was the money went to). And I also don't plan to have a mortgage in retirement.

If I did include taxes it would be a very different number for me. We pay about as much in total taxes as we pay in everything else combined.

[Davids]

I'm just legitimately confused how you hit a 72% gross savings rate?

That means taxes, rental or mortgage, utilities, gas (if applicable), insurance, food, entertainment (even if small) all add up to 28%

For my income I use my gross income less federal, state and local taxes taken out of my pay (i.e. if I earned $100K and $30K was taken out as taxes I use $70K as my revenue line). My property taxes, health, home, auto insurance premiums are included in my expenses. For mortgage just the interest is my expense as the principal is considered savings. I have kept my utilities fairly low. 

[bigalsmith101]

I'm just legitimately confused how you hit a 72% gross savings rate?

That means taxes, rental or mortgage, utilities, gas (if applicable), insurance, food, entertainment (even if small) all add up to 28%

For my income I use my gross income less federal, state and local taxes taken out of my pay (i.e. if I earned $100K and $30K was taken out as taxes I use $70K as my revenue line). My property taxes, health, home, auto insurance premiums are included in my expenses. For mortgage just the interest is my expense as the principal is considered savings. I have kept my utilities fairly low.

My wife and I utilize nearly the exact same calculations, though we pay rent as opposed to a mortgage. Even still, our expenses represent about 37% of our after tax income, representing a 63% savings rate for the first 4 months of this year. I expect that to increase as the year progresses as well as I'll be selling some unused valuables and counting that in the revenue stream.