How Much Did You Save in 2012?

If there’s one thing to be said about Finance sites (especially the blogs), it’s that there is no shortage of voyeuristic information posted for the view of anyone who happens to wander by.  Think about it – straight Personal Finance blogs sometimes detail every transaction the author makes, Investment sites demand disclosure about what stocks a person owns, Advisor sites come complete with a detailed biography, and debt blogs?  Well, those blogs take disclosure to a new level…

DQYDJ on the other hand, metes out the personal details slowly – because, well, you are not Cameron, Bryan or me.  Decisions we make are generally good for our situations, and we do our best to explain how you should approach similar decisions.  However, this is a site built on trust.  So, once again, we open our books to our faithful readers so you can see if we’re (well, at least if PK is…) trustworthy enough to deserve your subscription.

Your Favorite Author’s Savings Rate

I use a very strict definition of savings for my calculations, spelled out back when Cameron and I did a point-counterpoint series last year.  In essence, I only count liquid savings vehicles – savings accounts, retirement accounts, and the like versus net income.  If I counted principal pay-down it would obviously be quite a bit higher.  And, of course, if I also counted home improvement spending (I’m sure you could make the case), it would be much higher (heh, especially this year).  But we’ll run with what we’ve got – here’s the PK household’s (strict) savings rate since 2007:



So that’s 26.07% net in 2012, using my definition of savings.

How did you do in 2012?


  1. says

    Using your strict definition, I saved almost nothing because every time I have over $5K in the bank, I get anxious to invest in something you wouldn’t consider liquid (almost no stock market). I did buy 45 heads of cattle, a house cash, poured another bundle in building more house and improving the current one, that would bump the rate quite a bit. At least 60% if you consider it all.

    • says

      Yeah, it pains me not to include renovations and home equity gains – it’s just with savings I’m considering only the absolutely liquid (even stock in a retirement account you can get to in under a week).

      A more relaxed definition might be more useful, but with this one you can kind of see how your money is broken up (I do attempt to include principal reductions in my spreadsheet, but this is my top-line).

      • says

        I don’t put renovations but consider that I could easily get the price I paid for if I had to sell my house tomorrow. And it was paid cash, so before that, the cash was in savings, hard to consider it just disappeared.

        • says

          Yeah – I don’t account for any spending from savings (if it happens after the year ends – otherwise it nets out anyway, heh). And I have no doubt my renovations are worth something (they get the nod of approval from my wife – and she’s an Interior Designer, so I feel like I have something here).

    • says

      2x? Tough to argue with those results, haha. Hope the new job is as awesome as it is lucrative.

  2. Jacq says

    78.63% in 2012 using the same definition as you (but I’m probably 20 years older so it’s logical that it’s higher).

    • says

      78.63% using the strict definition? That’s impressive at any age… could be over 100% if you relax the definition a bit, heh. You’ve got my respect and admiration.

      • Jacq says

        Oh, I don’t think it’s such a huge accomplishment. Someone saving 10-20% on an income of $25k/year is more impressive since I can still live a middle class lifestyle w/vacations etc. at that rate where they have to really cut expenses.

        Over 40% of the bogleheads in this poll are saving >30% on gross.

        • says

          I guess there are two demographics here – bloggers, writers and people in the saving lifestyle (I’d include people of forums, article commenters, etc. here – people who have been around a bit) and then… everyone else. In the former, you’ll probably always find someone with a higher rate in some area… but in the latter? Numbers are hard to come by, but keep an eye out for my take on the recently release CEX numbers. That’ll be my next piece in that series, after the food and sin taxes, heh. And yes, I haven’t built the calculator yet, but more income means more savings.

    • greg says

      nice – you put me to shame at 68% or so last year, and beat my goal of 75% this one. Do you already have a paid-off residence?

      • Jacq says

        No, the house isn’t paid off. In 2012, I was doubling up on the mortgage up until Sept or so. The higher rate just came about because I was too busy working to take a decent vacation or spend much money on house renos. :-(

  3. says

    Similar to Pauline, there was a much smaller amount of our capital that went into liquid investments than into less liquid ones. So I tend to look at it like this: We took home about $184K in taxable income, spent $37K on FICA and income taxes, spent $55K on everyday living expenses (mortgage included), and the rest went to 401Ks, IRAs, paying down some of the leverage on our investment properties, and rebuilding a cash buffer. Paying down leverage on our investment properties probably wouldn’t count as savings under your definition, but we look at it as finishing an investment we started a year or two before.

    • says

      Yeah, I don’t mean to lord my savings rules over the whole internet (just one definition!), but I try to avoid things that are harder to value (i.e. houses) as well as principal pay-down, even though they both obviously increase net worth…

      … All of that means my definition is a strict one. Living in the Bay Area, it pains me to not include equity gains (especially those I forced by renovating rooms, which cost quite a bit, heh).

    • says

      It’s evolution, baby!

      On home equity – I know it’s there, I just hate pointing at a value. I know my house is worth more than when I bought it (fixer upper mostly fixed in the Bay Area), but I still don’t count the principal pay-down in this accounting anyway. Using a relaxed definition I did a lot better.

      • says

        I’m not really talking about home equity though. I’m saying if you have $2,000 left over after all your bills and expenses are paid, that’s your savings rate. For me, some of that goes toward extra mortgage payments, some goes to my RRSP, some goes to my TFSA and some just sits in a savings account.

  4. says

    47.74% using your strict definition, or $62,167.69. Read: 2012 Yearly Roundup

    I tend to look less at the percentage than I do at the actual amount, mostly because my income varies, and I’d like to reach $50,000 in savings a year on average which can mean 100% or 50% or anything in between

    … Although 2013 may be a bust in this regard.

  5. says

    47.74% using your strict definition, or $62,167.69. Read: 2012 Yearly Roundup

    I tend to look less at the percentage than I do at the actual amount, mostly because my income varies, and I’d like to reach $50,000 in savings a year on average which can mean 100% or 50% or anything in between

    … Although 2013 may be a bust in this regard.

    • says

      Haha, my definition is right in your wheelhouse, eh? I can’t in good conscience recommend buying Canadian real estate to you because:

      1) I’m American, most of what I say would be third hand

      2) Most of the third hand knowledge I have is… well, about scary overvaluations.

      So, Crack Shack or Mansion?

  6. says

    I don’t like to disclose actual numbers for a lot of my own personal finances. I’ll generalize the numbers, talk in percentages or gains but I dislike the idea of opening up the kimono and reveling net worth, income etc. I do try to save a minimum of 15%, i would like it to be more but as long as I’m paying off debt, I won’t save more than that.

    • says

      Or the Chinese saying, “taoguang yanghui”… that’s the one I like.

      (Roughly: “Hide brightness, nourish obscurity”.)

  7. says

    Unfortunately My saving rate is poorly low. Instead I believe (actually I am able to do that only) in grabbing my necessity first and then paying i later. I don’t know why it happens but at the end of the month my BB becomes nil.

  8. says

    Our family saved about 21% of gross income, and this was tough!!! I’d like to get it higher this year. We plan on having kids in 2 years, so I’d like to sock away as much as possible now!

    • says

      What’s the goal? If you state it publicly, you’ve got abetter chance of hitting it… or something, haha.