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Old 06-10-2009, 07:48 PM   #41
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After reading this thread, I feel so poor!! My salary will never hit six figures.

You all have done really well.
It's all relative. You feel poor but probably nearly double my income. I know many people who would love to have my $45K/yr income. In my family, i'm the one with a "high income". My income nearly doubles my brothers, cousins and several of my friends'(all in their 20's and 30's). It's all relative. Just LBYM, whether you make $20k or $200K
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Old 06-10-2009, 08:20 PM   #42
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(for 1 child but this amount will double since kid #2 is due in Dec. :-) )Not incl. employer matches on the RRSP's, we save almost 40% of our gross income. We're putting a lot in cash right now since I'll be going on maternity leave in Nov. for one year (and not sure yet if I'll be going back to work at the end of it).


Congratulations !
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Old 06-10-2009, 08:27 PM   #43
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It varies, but north of 30% of gross at the moment. Bulk of that is going into the 401(k), with some going to kids' 529s/ESA's and some going to a taxable account.

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Old 06-10-2009, 08:30 PM   #44
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It's all relative. You feel poor but probably nearly double my income. I know many people who would love to have my $45K/yr income. In my family, i'm the one with a "high income". My income nearly doubles my brothers, cousins and several of my friends'(all in their 20's and 30's). It's all relative. Just LBYM, whether you make $20k or $200K
I agree completely. Cut expenses and be so much happier.
My FIRE total gross income is just about half my pre-FIRE gross income. Only because one of those income sources was not affected by FIREing. It really made no sense to keep w*rking, because my earned income (salary) was destroyed by payroll deductions and taxes. The more you make...the more they take.
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Old 06-10-2009, 09:46 PM   #45
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2008:

1) Cash / Investment $40k
2) Retirement (401k, IRA..) $23k

Saved 34.4% of Gross Income
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Old 06-10-2009, 09:57 PM   #46
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This is our last year accumulating.

I looked back over the last few years as I do do keep track of saving for ER as a % of income and it was running at ~50% thru' 2007 when last child graduated and it was 62% in 2008 and running at 65% ytd 2009.
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Old 06-10-2009, 10:01 PM   #47
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Even retired we are averaging 37% savings of our gross and half of that is tax deferred.

If I really get greedy I could kick it up a notch to 49% by taking SS. But I'm not going to do that .............. I'm waiting till it's even more.
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Old 06-10-2009, 10:10 PM   #48
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Cash = $2k (to emergency fund)

Retirement = $45k of our money + $16k from company match/cash balance pension. This $61k is spread among IRA, 401k, cash balance plans, etc.

Investments = $0 (our investments ARE retirement savings)

Kids = no children

Play money = $2k (we save for hobbies/fun/vacations, although this is spent the following year) We just increased our savings for this because our 15 year anniversary is in 2011 and we want to go somewhere nice/expensive, like Hawaii or Germany.
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Old 06-10-2009, 10:11 PM   #49
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Even retired we are averaging 37% savings of our gross and half of that is tax deferred.
How do you contribute to tax deferred savings if you have no earned income? Can you put pension income into an IRA?
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Old 06-10-2009, 10:15 PM   #50
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How do you contribute to tax deferred savings if you have no earned income? Can you put pension income into an IRA?
All the interest earned in tax deferred accounts is tax deferred too, even though I don't make any contributions.
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Old 06-11-2009, 10:09 AM   #51
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Thanks for enlightenment on the nature of ind 401k... that will save me the time of today's task of wading thru all your back posts to try to figure out who your employer is and start sending my resume.
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Old 06-11-2009, 10:12 AM   #52
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We figure wife's pension like a 401k for now, who knows what the future holds. It's just a tax-def contribution with a 100% match that can be rolled into a IRA as a lump sum upon separation.
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too much saving
Old 06-11-2009, 10:39 AM   #53
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too much saving

there are a lots of folks here save a high percentage of their gross income. Congrats....

do you enjoy more in spending or savings heck, that could a new post question all together. For me, it;s a little of both but I do admit I favor spending than saving... hehehe.. I rather have a cup of wine over a glass of water when i go out.


enuff
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Old 06-11-2009, 11:00 AM   #54
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I like spending too. Spending is a kind of national entertaining.

Thing is a nice cash buffer giving me a safe feeling, which is priceless in this time. I got layoffed three months ago. I worked hard to land down a new job in one month. But same time, I was pretty relaxed. No one in the family was nervous.
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Old 06-11-2009, 11:03 AM   #55
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do you enjoy more in spending or savings heck, that could a new post question all together. For me, it;s a little of both but I do admit I favor spending than saving... hehehe.. I rather have a cup of wine over a glass of water when i go out.
I enjoy saving a lot -- it makes me feel like I'm buying more of my future years back from employers. But at the same time, I don't enjoy living an austere lifestyle, and so I do enjoy spending money on things that will really enhance our current quality of life. I'm a little tighter about that definition than I used to be -- meaning it's harder to get me to pry my wallet open for "stuff" -- but when I judge it to be worth doing, I'm not afraid to spend (especially since my paycheck's not a single point of financial failure any more)...

As for your example, if having the glass of wine enhances your enjoyment of life enough to justify the expense and you're still saving enough for emergency funds, retirement savings and debt paydown, go for it! I have little use for the hyper-LBYM attitude that says even one dollar spent on non-discretionary stuff is wasteful, conspicuous consumption.
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Old 06-11-2009, 11:46 AM   #56
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Regarding saving vs. spending, there was a great rant letter in the local newspaper the other day after they published an article about the most frugal family:

Much more to life than frugality

Thank you so much for allowing me a glimpse of the life of the winners of the most frugal family contest ("Winners of 'Republic' contest offer 20 ways to save," Arizona Living, Thursday).

I want to be like them when I grow up! That way, after my monthly $40 entertainment money has been spent, I can sit in my home in the dark with the AC off while waiting for a new month and new allowance to kick in.

And when my gas money is gone, I can make my way across town on a bus lugging my children around because I refuse to use a credit card.

There is a word for people like these. They're called martyrs. I would rather be homeless than live in the self-imposed prison they call fiscal discipline. They remind me of anorexics who count every apple slice they eat, thinking they'll get fat if they allow themselves another bite.

Sorry, I would rather enjoy my life than spend every day counting pennies. There is a way to live a life within your means while still allowing space for spontaneity, which they've clearly robbed themselves of.

I find their lives both depressing and bizarre.

- Diane Bancroft, Scottsdale



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Old 06-11-2009, 01:09 PM   #57
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Keep in mind this was a "solo" 401K, where it's often easier to get a large "company match" (which just comes off the top of your pay as a 1099-based contractor). You can put in the usual $16,500 like an employee, but take even more out as an "employer match" if you're self-employed.
This is how my wife and I manage to tax defer $70K last year. I limited out the solo 401k ($46k) and she put in $24k. You can really go crazy if you set up your own personal defined benefit plan. You tax deferred savings can essentially become unlimited. However, this involves lots of overhead with specialty consultants ($$$) and I have elected to not pursue this option.
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Old 06-11-2009, 02:54 PM   #58
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do you enjoy more in spending or savings heck, that could a new post question all together. For me, it;s a little of both but I do admit I favor spending than saving... hehehe.. I rather have a cup of wine over a glass of water when i go out.


enuff
Naturally, I enjoy spending. However, I do not feel comfortable doing so unless I am saving a healthy proportion of my income.
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Old 06-11-2009, 03:05 PM   #59
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do you enjoy more in spending or savings heck, that could a new post question all together. For me, it;s a little of both but I do admit I favor spending than saving... hehehe.. I rather have a cup of wine over a glass of water when i go out.
I enjoy both. Right now I am looking forward to 2 things: sending a bunch of money to Vanguard on Monday (next paycheck), and buying a brand new digital camera... I am equally excited about both prospects.
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Old 06-11-2009, 03:11 PM   #60
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do you enjoy more in spending or savings
Spending. One of the things I get the biggest kick out of is buying a few more shares of Wellesley VWIAX.

Then I watch over it every day just like a potted plant, to see if it is thriving and doing OK. If I am lucky, it grows. Unlike a potted plant, every three months my Wellesley pays me back.
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