Join Early Retirement Today
Thread Tools Search this Thread Display Modes
2008 Analysis - Spending, Taxes and Savings
Old 01-31-2009, 08:21 PM   #1
Recycles dryer sheets
Culture's Avatar
Join Date: Apr 2007
Posts: 491
2008 Analysis - Spending, Taxes and Savings

I finally completed my 2008 taxes today, and calculated my percentage of gross income [including dividends and interest] that I 1) spend on myself 2) spent on taxes [local property, federal, self employment and SS only] and 3) saved.

Taxes: 24.3%
Spending: 22.9%
Savings: 52.8%

Anyone else done this analysis? I went to work for myself this year and my income increased substantially. This is my best year ever for savings. Typically in the past I have saved about 33% of gross income. I am feeling pretty good about where we are with our plan. If we can hold down any increases in expenses/spending, retirement looks like a lock in 4-5 years.

OTOH, my wife took me to the car show today to look at cars .

Culture is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 02-01-2009, 03:58 AM   #2
Thinks s/he gets paid by the post
OAG's Avatar
Join Date: Jun 2006
Location: Central, Ohio, USA
Posts: 2,594
I think this analysis is done by many here every year.

FWIW and according to MS Money our 2008 percentages are:

Taxes: 7.5% (Only RE Taxes; $0 Income taxes this year, IRC 1341 Recovery)
Spending: 30.4% (Living expenses)
Savings: 62.1% (More spent this year, lower savings)

We intend to increase the spending in 2009 but, by how much, it is hard to tell.

Vietnam Veteran, CW4 USA, Retired 1979
OAG is offline   Reply With Quote
Old 02-01-2009, 08:57 AM   #3
Thinks s/he gets paid by the post
target2019's Avatar
Join Date: Dec 2008
Posts: 3,036
I'm not retired. It was an unusual year, with a death benefit, car payoff, and college tution.

Taxes: 23.3%
Spending: 65.5%
Savings: 11.2%

Above does not include 401(k) or 403(b) contributions.
target2019 is offline   Reply With Quote
Old 02-01-2009, 09:52 AM   #4
Moderator Emeritus
Join Date: May 2007
Posts: 10,693
For 2008:

Taxes (income, payroll): 22%
Spending (including all other taxes): 32.5%
Savings: 45.5%
42 y/o, married, retirement portfolio = 43 x annual expenses
FIREd is offline   Reply With Quote
Old 02-01-2009, 10:00 AM   #5
Recycles dryer sheets
shotgunner's Avatar
Join Date: Jun 2008
Posts: 443
Savings? I am in the withdrawal phase..... and the market performance has been "withdrawing" a LOT more from my portfolio than I am

2008 - Taxes, Savings and Spending (20%)
Never surrender what you really want for what you want right now.
shotgunner is offline   Reply With Quote
Old 02-01-2009, 10:50 AM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 13,016
I won't really know until we file our taxes around April 1. I haven't even gotten my 1099s yet, so I don't know for sure qualified dividends, etc.

Savings? Hah! Living off investments.

Spending? I guess I can do it as a percentage of net worth. Gee - do I calculate that from the beginning of 2008 or the end?

audreyh1 is offline   Reply With Quote
Old 02-01-2009, 11:12 AM   #7
ziggy29's Avatar
Join Date: Oct 2005
Location: Texas
Posts: 15,419
If I were to make assumptions about my 2008 tax refund and transfer it to the "savings" category, it's roughly:

Taxes: 17.8%
Spending: 44.3%
Savings: 37.9%

Not bad for a couple of SINKs. Just thinking where it would be if we could finally become DINKs makes me want to vomit at all the lost opportunity. My plan is for the last two numbers to flip-flop in '09 assuming no change to the status quo.
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
ziggy29 is offline   Reply With Quote
Old 02-01-2009, 06:48 PM   #8
Recycles dryer sheets
Culture's Avatar
Join Date: Apr 2007
Posts: 491
Originally Posted by Culture View Post
Taxes: 24.3%
Spending: 22.9%
Savings: 52.8%
Oops, left health insurance premium out of the spending column. It was a business expense, but certainly should be considered an expense, as I will still be paying it in retirement. So make it:

So make this:
Taxes 24%
Spending 26%
Savings 50%

Culture is offline   Reply With Quote

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
2008 Actual Spending and 2009 Budgeted Spending dex FIRE and Money 122 03-17-2009 02:49 PM
Taxes 2000 versus 2008 OAG FIRE and Money 2 11-24-2008 07:54 AM
2008 Income Taxes - Use Cap Loss chinaco FIRE and Money 4 11-22-2008 03:35 AM
2008 cap gains taxes: zero in 10% & 15% income-tax brackets Nords FIRE and Money 37 08-02-2006 04:41 PM
Vanguard Retirement Analysis vs. 4% withdrawal analysis familyretired FIRE and Money 3 08-26-2005 02:33 AM


All times are GMT -6. The time now is 08:22 PM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2016, vBulletin Solutions, Inc.