What is your savings rate ?

What is your savings rate ?

Recent statistics from the UK Governments Office For National Statistics show that on average people in the UK save 5% of their income (this includes pension savings), what is your savings rate – how does it compare to this ?

savings ratesThis 5% level of savings is forecast to fall over the next 4 years to around 3%

It seems as though our spend now forget the future culture is deeply embedded in the nations psyche

In China the savings rate is 50% of take home income, India has a savings rate in the mid 30%s  and in the world as a whole there is a worldwide average savings rate of 19%.

 

Makes you wonder why so called “developed” nations save so little in comparison to others

What Is Your Savings Rate

My savings rate is around the 30% mark if you consider debt repayment to be a form of saving

What is your savings rate ?

At present I’m making over £600 a month in card repayments – plus the occasional mid month payment when I’ve earnt a bit extra. This takes my savings rate to around the 30% mark on a monthly income of £2,000

Over time, my interest payments have fallen in line with my falling balances – but I’m still keeping my repayments at the same level.

I’ve got a load of stuff that I once bought from a wholesaler with the intention of re-selling it on Ebay (a failed project which i will blog about in the near future) and I’ve also got a few bits of antique Chinese porcelain which does nothing but sit in a box in the attic.

I’m going to sell all this stuff off at a sale, or on ebay this month and hope to raise a few hundred £££, all of the money I make will go towards reducing my debts.

Over the last couple of months, my work rate/ethic/motivation has been increasing – resulting in me making well over the £2,000 a month that I currently pay myself.

I am going to take some extra money out of my business next month and pay down my debts a little further (as well as take a well deserved week in the sun)

Next post will be an update on my debt repayments, and also a little about starting off an investment portfolio

 

 

Comments

  1. What is ‘£600 a month in card repayments’? Does this mean you are paying off debt? Just asking, otherwise well done (I used to call my debt ‘negative wealth’ because it’s a way to increase your networth anyway).
    Our saving rate is about 40% at the moment.

    • getrichwithme says:

      yes Maria, I racked up £24k while I was setting up a new business.
      With no bank loans available to small businesses the money had to come from somewhere.
      I’ve carried the balance for a couple of years – but decided to do something about it in Aug 2013. I’ve knocked £6k off it since then and am going through the painful process of working it down to zero

  2. We are currently saving/investing ~ 35% of our gross income. We paid off both vehicles a little over a year ago and just recently paid off the last credit card – only the mortgage left with respect to debt . Therefore, our savings rate strictly considers savings and investment accounts.

  3. One of the things I have wondered is if you saved 20% pre-tax and another 20% after tax then how much are you really saving? Do we base this off of our gross pay or our take home pay?

    Is it 40%, or is it more since you save 20% of your after tax income?

    I think I’m somewhere around 40-45% at the moment. I don’t want to go too extreme into saving because I fear it will lead to burnout and then I’ll have to splurge on something I shouldn’t.

    • getrichwithme says:

      You’re taxed first – then you save.
      Once you have savings, then you’re taxed on the interest unless its held in a tax free environment such as a pension or ISA
      You pay tax on your income from your pension once you start to take it (but have previously benefited from tax relief when you make the initial contribution)
      You pay no tax on income or capital growth within an isa
      They’re are the UK rules
      Hope that helps

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