Curious: What Percentage of your gross Income are you Investing Annually

[ControlD]

I invest 12% of my salary (3% match) into the company 401k, sometimes ROTH based sometimes not depending on what my annual tax outlook is. I occasionally put money into some other investments and stocks as well. My wife and I both have ROTH investments as well, but we haven't been able to contribute for years now due to salary restrictions.

 

[Exterous]

30% invested + 10% of my salary company match + 3.6% of my wife's salary for pension contributions.

 

[KentState]

There's a new IRS ruling where you roll over your after tax 401k contributions to an roth ira (when changing companies or retiring) without being taxed during the conversion. Of course your company needs to allow for after tax 401k contributions.

So you could max out your 401k and then do the after tax contribution. It's pretty amazing, it went into effect on Jan 1, 2015. I just read up on it, found out from a friend.

"In essence, you can now contribute over $50,000 per year into your Roth IRA," says Brian Frederick, CFP professional and associate financial planner at Intrinsic Wealth Counsel in Tempe, Arizona.

Good article about it here: http://www.bankrate.com/finance/retirement/after-tax-401k-rollover-to-roth-ira-rules.aspx

but if your company 401k plan allows in-service withdrawals of after-tax (not roth) 401k contributions, you can put about 30$k extra into your 401k each year and then roll that over to a roth IRA.

edit: yep, what net said. i've been doing that for a few years now, even before the official ruling came out. figured i would take my chances.

Thanks for the advice. Something I will look into once we get settled with the house and now private school.

 

[Xonim]

I put in 15% plus company match of 5%, my wife puts in 20% plus 7.5% match, plus $50/mo into a Roth IRA for each of us.

 

[cbrunny]

~9% plus work match of ~7.5% plus an additional ~2% into cash savings for rainy days. My wife is very similar, though slightly less.

 

[JTsyo]

10% into 401K plus 4% match. Then I throw in about 5% into VTI each year that I plan on just holding until needed.

 

[rh71]

i just spend 20-25$k a year and save the rest. still living the same as i did when i graduated from college 10 years ago.

trying to be able to retire by 45 or 50, because i don't know if i'll be able to work past that age due to medical problems.

also need to have money on the side to support my parents' retirement.

mortgage paid off or rent?

 

[rh71]

Anyone else get the feeling our next generations will be richer and richer because people nowadays plan for retirement more (there's dual income too) and will have more to pass on after death? This could shift a lot of things like their spending habits or how hard they work, etc. Maybe even how competitively jobs pay in the future or housing prices because people will have more to offer. Will things simply cost a lot more, like college already does...

Or - do you think people will just spend their retirement savings on themselves?

 

[Feneant2]

About 12% then I borrow at the end of the year to invest a bit more but the tax return offsets that. That's on my own plus I have a pension which is about another 9% and I believe my employer matches the full amount.

Wife is self employed and I've convinced her to start paying herself more to invest so for her it'll be about 30% of her gross income.

 

[dullard]

50% of gross income into tax deductible 401k + after tax 401k + roth IRA + taxable accounts + I bonds + savings account

That is basically what I am doing. No bonds yet and I try to keep the after tax 401k to a minimum for flexibility (no good enough reason to lock up money into 401k rules without the benefits).

15% (including your contribution, your employer's contribution and social security) will let you retire at a normal age with about the same lifestyle as before retirement. So I am definitely way oversaving. But I enjoy life enough as it is now with no real need to spend more just so that I save less.

 

[jlee]

~27% to max 401k, HSA, IRA..non-work income basically offsets my rental. I'll hit taxable accounts when I'm done buying MR2 stuff.

 

[purbeast0]

That is basically what I am doing. No bonds yet and I try to keep the after tax 401k to a minimum for flexibility (no good enough reason to lock up money into 401k rules without the benefits).

i have to ask dullard - what do you do career wise?

i know you travel all over the world often, and while i know you CAN do it (relatively) cheap, going as often as it seems you do and as many places you've been can't be too cheap. and to save 50% of all income on top of that?

that's some baller shit right there.

i do recall though that you always have insightful information when it comes to investing and what not, so clearly you know how to do that stuff.

 

[dullard]

i have to ask dullard - what do you do career wise?

i know you travel all over the world often, and while i know you CAN do it (relatively) cheap, going as often as it seems you do and as many places you've been can't be too cheap. and to save 50% of all income on top of that?

that's some baller shit right there.

i do recall though that you always have insightful information when it comes to investing and what not, so clearly you know how to do that stuff.

Thanks. I'm a dink (dual-income-no-kids). My wife and I are both chemical engineers (I'm a PhD, she is an MBA) with good jobs, in a low cost of living state. We are certainly not in the top 1%, but we aren't that far off either.

It doesn't hurt that we are both quite frugal in most things (drive cars for 10+ years, house well below our means, don't eat out much, grow a lot of our own food, etc). It is very painful to spend money for me, even if it has no noticeable impact on my overall finances.

I'd spend more money on travel and invest less if I just had the vacation time. This will let us retire early if we ever choose to do so.

 

[pauldun170]

14% into 401k where employer match is a 5% per pay period and 3% annual.
Sole breadwinner for a family of four with a mortgage in NY limits how far I can push that % up.

 

[purbeast0]

Thanks. I'm a dink (dual-income-no-kids). My wife and I are both chemical engineers (I'm a PhD, she is an MBA) with good jobs, in a low cost of living state. We are certainly not in the top 1%, but we aren't that far off either.

It doesn't hurt that we are both quite frugal in most things (drive cars for 10+ years, house well below our means, don't eat out much, grow a lot of our own food, etc). It is very painful to spend money for me, even if it has no noticeable impact on my overall finances.

I'd spend more money on travel and invest less if I just had the vacation time. This will let us retire early if we ever choose to do so.

:thumbsup:

good stuff. we just had our first kid and while obviously we're spending more money we're still making travel a priority. that is the one thing we've always said we will do.

we're also not in a cheap COL place (dc metro area) and want to move to an even higher COL area (san diego) but aren't sure if/when that will happen. but i wouldn't do it if it meant we couldn't travel as much since we'd be more house poor.

 

[Genx87]

Maxed(18K fed limit) 401k
Max Roth IRA
Toss in another 5-10 in an investment account depending on my financial situation at the end of the year.

 

[Exterous]

Anyone else get the feeling our next generations will be richer and richer because people nowadays plan for retirement more (there's dual income too) and will have more to pass on after death?

The reports seem mixed with some showing more are starting to save and save earlier while others say they are not starting as early due to things like student loan debt. It's certainly possible but I doubt there will be any large changes in how much the next generations have for retirement

There does seem to be an increase in skepticism\aversion to the stock market but that is a bit hard to empirically chart out in comparison to how other generations felt at the same age

 

[cbrsurfr]

Max 401K + 50% of up to 6% company match, 4-7% 401K company profit sharing, max Roth IRA, and an additional 3% to mutual funds in a taxable account. Anything extra goes into Ally savings @ 1%. No debt other than 2 houses. I also have an investment property currently occupied. Still doesn't seem enough, I want to retire in my 50's.

 

[IronWing]

100%, though some of my investments turn to crap.

 

[brianmanahan]

mortgage paid off or rent?

i just rent, cheap place at like 400$ a month

i should find a cheap house at some point... but i've been too lazy, and it's nice not having to fix stuff or pay property taxes

 

[ponyo]

i just rent, cheap place at like 400$ a month

i should find a cheap house at some point... but i've been too lazy, and it's nice not having to fix stuff or pay property taxes

Do you just rent a room? Because even the cheapest apartment in the ghetto would be more than $400 a month.

 

[repoman0]

23% 401a/403b - definitely seem to be in a unique position with these because my maximum is well over the $18k of a standard 401k. It's more like $30k

Max Roth IRA

Usually max my HSA at the end of the tax year when I realize how much it reduces my tax liability (~2.7k extra, somehow last year that meant >40% net tax liability reduction on that amount I think because it phased some education benefits back in)

Whatever I can into taxable accounts, which goes to a mix of VOO/VTI, bonds, and cash, heavily weighted towards the stocks right now. I don't keep much cash on hand, which may or may not be a bad idea.

I'm hoping to be comfortable enough in my 40s to switch careers and try something new without worrying about how much it pays. I think teaching the first 3-4 physics classes at a CC would be great, or teaching high school AP math and physics. I've heard engineers can get right into those kinds of jobs without a teaching degree.

 

[brianmanahan]

That's pretty crazy intense/agressive, kudos to you for being able to sustain that. Can I ask what kind of strategy you're using? Since at some point, you run out of company match / tax-deferred/favorable options etc.

sure, i just allocate my whole portfolio (all accounts combined) to 50/25/25 US market/international market/bonds.

once i run out of room in tax-deferred or tax-free options, i just do regular taxable investing with vanguard. i only use VTI (total US index) and VXUS (total international index) in the taxable account to make it more tax-efficient.

For me I was doing 10% pension (company matches most of it), 10% company shares (company matches a good portion), close to 10% into RRSPs and what little I could save from biweekly pays and tax returns either back into other RRSPs or TFSA. Although I have scaled this back somewhat as the heavy saving causing not actually earning any more net dollars for so long it was starting to get to me lol. At some point you really do just need a little bump to feel something IMO.

that sounds like you are saving a lot too! with the matches that'd be about %50.

i will probably scale back about %5 this year because i'm spending some extra money on a couple of one-time vacations.

 

[brianmanahan]

Do you just rent a room? Because even the cheapest apartment in the ghetto would be more than $400 a month.

not everyone lives in a ridiculously-high-priced part of the country

550 sq ft, in a small town about 45 minutes outside of the city

looking at good 1200 sq ft houses here for about 50$-60$k

 

[jlee]

23% 401a/403b - definitely seem to be in a unique position with these because my maximum is well over the $18k of a standard 401k. It's more like $30k

Max Roth IRA

Usually max my HSA at the end of the tax year when I realize how much it reduces my tax liability (~2.7k extra, somehow last year that meant >40% net tax liability reduction on that amount I think because it phased some education benefits back in)

Whatever I can into taxable accounts, which goes to a mix of VOO/VTI, bonds, and cash, heavily weighted towards the stocks right now. I don't keep much cash on hand, which may or may not be a bad idea.

I'm hoping to be comfortable enough in my 40s to switch careers and try something new without worrying about how much it pays. I think teaching the first 3-4 physics classes at a CC would be great, or teaching high school AP math and physics. I've heard engineers can get right into those kinds of jobs without a teaching degree.

If you max your HSA throughout the year via payroll deduction, you avoid FICA taxes as well. I'd do that instead of a lump sum contribution at the end of the year.