Before I put 2016 in my rear-view mirror, I want to take a final look and calculate our 2016 savings rate. Every year the Mustachian Post updates its index of bloggers’ savings rates. That means it’s time for me to crank out a few spreadsheets for more awesome tables. First, let’s take a look at what we saved in 2016; here’s the recap:
2016 Savings Rates
Okay, now that we know what we saved last year, let’s take a look at our 2016 salary numbers. You can see in the next table that last year Edwina and I had combined salaries of $90,720. That number represents our gross pay (not net pay) from January to August of 2016. However, we also had another source of income last year, our 72t IRA distributions of $18,375. When we add that amount to our salaries, we get a total income of $109,095 for the year. (Some years we take 457 distributions for another source of income, but last year we did not take any.) Here is our total income for 2016:
|72T IRA Distributions||$10,404||$7,971||$18,375|
Our savings rate as a percentage of our salaries is 95.19%. As a percentage of our total income, it’s 79.16%. Those are certainly good numbers to know, especially after a bad day (month or year) of work. It’s a great feeling and incredible motivator to know that we saved almost 80% of our income.
2016 Adjusted Savings Rates
When you account for benefits and taxes, our savings rate percentages look even better. To make this calculation, I first need to total up how much of our income went towards our benefits (pension plan, health-dental-vision insurance) and taxes (Social Security and Medicare). As the table below shows, we spent $15,024 on benefits and taxes in 2016.
Sorry, that table is boring; I hope you didn’t spend too much time on those numbers! Anyway, when we subtract the money spent on taxes and benefits, we get our adjusted savings rate percentages. Our adjusted savings rate as a percentage of our salaries is 114.09% while our adjusted savings rate percentage of our total income is 91.80%. (These numbers look high even to me, so I’m sure they wouldn’t be approved by the Internet Retirement Police.)
It appears that our savings rates percentages are up as compared to our 2015 percentages. Last year’s percentages ranged from 64% to 105%. For 2016, our savings rates percentages range from 79% to 114%. I think the adjusted total income savings rate (91%) is the best measure of our 2016 savings. However, I wouldn’t feel embarrassed with a savings rate of 79% either. Either way I’m happy with last year’s numbers.
Alright people, it’s your turn. Take out a piece of paper and calculate your savings rates. Feel free to post your answers in the comments below.
|Health Savings Account: We use Elements Financial to access commission-free, low-cost Vanguard ETFs at TD Ameritrade.