How do you think you're doing with savings?

[tinkarooni]

OK, so I follow the budget board, watch all the Oprah Financial shows and have bought David Bachs automatic millionaire. How do you know when you're on the right track? For example we save a lot for retirement but I wish we had more in an emergency account. Is that OK? How do you think that you are doing? Are you happy with where you are financially?
When is enough saving, for example 15% of your pay, enough? What do you think?

 

[runwad]

Well I always thought I was doing pretty good and saving a lot but have never really sat down and figured out the exact percentage, well now I have and it's only 8.29% of our pay I thought it would be 10% for sure but I guess I pretty much have kept the same allocations without upping them in quite a few years because well...kids, home ownership and all the other little things that come up. My husband has deferred comp and I told him he needs to up his contribution but you know I have the 401k I think we can make more money by putting more away in my plan, I already do 10% there, but the plan at my company stinks so I took out 4% and automatically add that to a Roth every month since I felt that was more advantageous than my 401k....I think when our car and home equity for our remodel kitchen is paid off in October I'll put a chunk of that money into more of my IRA, then of course there's daycare...when will that end, it's been 10 years already pretty soon I"ll be done then I feel like I'll really have a lot to save...but then it'll be college uh? Oh and we do save a little in our kids' college funds but I didnt' count that into our percentage figure.

 

[dvcgirl]

OK, so I follow the budget board, watch all the Oprah Financial shows and have bought David Bachs automatic millionaire. How do you know when you're on the right track? For example we save a lot for retirement but I wish we had more in an emergency account. Is that OK? How do you think that you are doing? Are you happy with where you are financially?
When is enough saving, for example 15% of your pay, enough? What do you think?

There are a ton of factors that you need to look at to know whether you are saving enough. Have you ever plugged your numbers into any retirement calculators? That's really the only way to get a ballpark idea. And the best advice is really to see a certified financial planner. They'll ask you what your financial goals are, determine what your risk tolerance is, look at your ability to save and let you know where you fall.

For example, how old are you? When did you start saving? When would you like to retire? How much income will you need during retirement? These are all the types of questions you need to ask yourself.

As for whether or not 15% of your pay is enough, well, that depends on when you started saving. Beginning at age 40 and saving 15% is probably on the low side if you'd like to retire at 65.. Consistently saving and investing 15% from age 25 would put you in a much better position. There are just so many variables at play here.

 

[azgal81]

I also suggest the calculator then depending on how old you are it will let you know how much you need to save to have a comfortable retirement. I'm 25 and save 50% of my income for retirement, vacation and other. Since I started saving for retirement at a young age I am saving only about 10% to retirement and the bulk of my savings is to my other savings account with my emergency fund and money for large purchases I want to make in the future.

I think it depends on alot of factors your age, retirement age and total money to retire with goal.

 

[disneysteve]

How do you think that you are doing? Are you happy with where you are financially?

I think we are doing fine. I am a personal finance junkie and regularly read at least 4 monthly financial magazines (Money, Kiplinger, Medical Economics and Physicians Financial Digest) as well as various online sources. By all reports, we are on track for where we should be based on our age and income. I play with the various online calculators from time to time. And about every 5 years I have a planner run a financial analysis. So far, so good.

We currently save about 28% of our income overall and we are in our early 40s.

 

[DVC Sadie]

We are doing fine but I admit that due to the increase of cost of living we are not putting the same amount into our vacation account nor are we putting the same % into our savings account.

With the increase of gas, home heating/ac, homeowners insurance and electric we are putting more money into liquid assets to offset the huge price increases. We will see where everything stands in the next 12 months and make adjustments as necessary.