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I was wondering how many people are actually achieving the Mr. Money Mustache savings rate. If MMM meant 60% post-tax dollars then yes, we have been able to do that for the last two years. I thought it meant 60% gross at first.
We are hoping for savings like that once the house is paid for. I figure at least 50% of our gross. Maybe, but maybe more or 50% of net at least.
With the house paid for, we can breathe much easier.
We accumulated some debt updating the house, thst will also be gone in the next 3 years. Then, if we keep doing what we,are doing now, we should be able to save at least that or more and the house will be paid for along with the improvements. Only monkey wrench is we have to replace my minivan by then
If we are up to it and nothing changes in the 10 years following, includes no raise, no bonus etc, we should easily save a quarter mil, if not 300k. That's just saw savings. That may only be $25k +/- a year, but compared to what we make, it should be easily done. If it changes, well be more towrds 500k in just the nect 10 years. My OH will switch agencies for one job, which will mean about a 40-50% increase in pay. The second job can also have a 20-25% increase changing stores, which we hope for next year. That will mean we could save 60% if we live as cheaply as we do NOW.
Now, we just have to get my OH hired there!!!
I'm limited to what i do, as losing the SSDI would be a current hardship. I can still earn my 24 hours, but unless I get a huge pay increase and 40 hours, I'd lose too much, and I don't think physically I can handle working more. I've got 3 months I can earn as much as I want, and will try for second job. But at least If I can't hack it, I've still got my SSDI. If I could physically do what my OH dies, is do the same thing as my OH, and I wouldn't have to worry about Losing my SSDI.
I don't know anyone saving 50%+ of gross that I know of. Few people I know have an income to save at that rate, even if they subsist at a meager level.
I live in an area where median household income is in the upper $30,000 range, if you throw out the college students. Outlying rural counties are much poorer than Johnson City.
I make slightly over $60,000 with my recent raise as a single guy here in small town northeast TN. After a 12% 401k contribution, taxes, insurance, and a $40/pp HSA savings, I clear $1,514 every two weeks.
My PITI + COA fees are slightly under $550. Power is between $75-$100, but I haven't been here in winter yet. Water/sewer are about $40 together. A standard "digital plus" cable package and 100 mbps cable package is roughly $85 after tax here. We're looking at about $800/month in mortgage, condo fees, and utilities. Internet only would be $65, so I sprung the extra $20 for cable for a year. Oh, the horror!
Local top of the line gym is $50/month, though I could cut that out and continue going to the YMCA in the town I work in on my dad's family plan if I had to. Cut three ways between my parents and myself, my portion of the Verizon bill is about $100/month. This includes the interest-free payment on my iPhone 8 and unlimited data. This would be about the last "luxury" I'd give up.
I have a monthly NY Times subscription. Ditto for WSJ. Netflix, WWE Network, and World of Warcraft too. All the subs are roughly $75/month. They all get used. I could cut all this if I had to, but cutting Netflix and cable together is about 1% of my net pay. It isn't that meaningful.
With that said, all the cutting I could do is penny wise and pound foolish compared to a massive income gain. If I had a partner making $60k, we could live on not much more than I make now. The fixed costs are mostly locked in if we stayed in my current spot.
There's no way I could save half my gross and live off a post-tax $60k, even going barebones.
That's why I said "in a way." You're paying in and getting something back. The relationship between what you pay and what you get back is very indirect, and it's any predicted amount (or anything at all) is also not certain, but neither is buying a home or stocks.
That's why I said "in a way." You're paying in and getting something back. The relationship between what you pay and what you get back is very indirect, and it's any predicted amount (or anything at all) is also not certain, but neither is buying a home or stocks.
You pay in with the hopes of getting something. It's not savings not even in a way. Buying a home, stocks or savings account you have actual ownership and that's not true of SS
I was wondering how many people are actually achieving the Mr. Money Mustache savings rate. If MMM meant 60% post-tax dollars then yes, we have been able to do that for the last two years. I thought it meant 60% gross at first.
It's going to be very few.
You have to have a large income to be able to do this. The median household income in my town is only in the upper $30k range.
If that median household saved 60% of their gross, they'd have about $18,000 gross to live on. That's poverty. You're hard-pressed to find anything to rent for under $500 around here. Grocery prices are high compared to most areas.
You're not going to come close to living on that. Even making $100,000 annually, that would give you $40,000 gross to live on. Doable, but still tight, IMO.
Here we are folks - responses from true blue MMM'ers:
Topic: % of PRE-tax income saved (Gross Income Saved)
"So PRE-tax to make it easy to calculate - for example, if all your gross income was $100,000 and you save $25,000 in long term savings, that is obviously 25%. The key is that it is GROSS (so everyone is counting from the same base), and it doesn't count if you're just saving for next year's vacation or to put a new roof on your house in a couple years. It has to be for retirement specifically, your kids' educations, or in general for more than 5 years down the road to count."
Out of 73 responders:
10-14% pretax 4 (5.5%)
15-19% pretax 4 (5.5%)
20-24% pretax 3 (4.1%)
25-29% pretax 10 (13.7%)
30-34% pretax 3 (4.1%)
35-39% pretax 7 (9.6%)
40-44% pretax 8 (11%)
45-49% pretax 7 (9.6%)
50-54% pretax 8 (11%)5
5-59% pretax 6 (8.2%)
60% + of your pretax income is saved 11 (15.1%)
Something else? Give us some details 2 (2.7%)
Oh yeah, that's a good point. I wonder if because I save nothing in the savings account if I get lumped into the no savings category of statistics. I keep my emergency fund in a 3% checking account and the rest is stored away in 401k/IRA/cash brokerage.
I haven't read ahead yet so maybe someone already asked but...a 3% checking account? Where is that at??
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