Retirement, Savings

Trying To Save 60% Of Gross Income

In 2007, I’m trying to save 60% of our gross income. (For a detailed breakdown of my 2007 savings goals, check out this post.) Here’s the progress so far. (I have a detailed chart of my college savings goal over at the NCN Network page.)

20% of our gross income will be dedicated for our pretax retirement accounts. These amounts are withheld from our paychecks, so there will be no need for me to track these amounts. For 2007, 16K in retirement will be a sure thing.

The other 40% of our gross income is equal to $32,000. This 32,000 will be spread out over 2 ESA accounts, 2 Roth acconts, and my Tradeking account. To achieve my goal, I will need to save 2,666.66 per month. (32K / 12). How did I do in January of 2007?

I managed to save 1800 in an ESA account, and an additional 1000 in my ING Direct account. I achieved my monthly goal, even surpassing it by a few dollars. I’ve already deposited the 1800 in the ESA account. I’ll keep the other 1000 in my ING Direct account until I decide which type of investment account I want to focus on next. (I might simply move the 1000 to the ESA account, but our dryer has been on the fritz. Until I’m sure that this money will not be needed in the next 2 weeks, I’m going to keep it in a more liquid account.)

4 thoughts on “Trying To Save 60% Of Gross Income

  1. congrats. i’m at 95% of gross income. but i think setting a percentage is a bit backwards, though. if you budget what you are going to need to live off of for the month, then the rest is savings. if you save based off of a percentage, then you will either scramble and potentially put yourself in a situation where you have to dip into savings, or you will have more money floating free which will be tempting to spend.

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