If people actually save 20% of their income ?

[Designerenvy]

Just that really !
I read that it's recommended to save 20% on your income ( after tax)
Not sure I could ever manage that with 3 Dc's.
Does anyone manage it and if so....any tip to help me manage it !
Need to clear debts and save ..... TIA

I don’t think it’s true that it’s how you were brought up, I think it’s a personality trait.
I was brought up to save, my mother was obsessed with saving and I just have a mental block with it.

I do give a lot to charity and that was not instilled in my either.
I guess I just think it will never happen to me that I need savings, which is really stupid and not true.

Not a chance in hell, I’m lucky if I’ve got £20 to spare the day before pay day most months.
Every penny we bring in is budgeted and accounted for whether that be bills, groceries etc. We do have a little every month that goes into the leisure pot, but that usually means a day out for the children once a month or something like that.

No way!
We have two good incomes but high expenses including large debts (incurred for good reasons and which we are working down steadily) and school fees. A good month for us is one in which we don't go over the fee-free bit of our overdraft!
On the other hand, I have a very good pension and quite a large inheritance on the way (sorting probate at the moment) so we can see better times ahead.
Even then, I doubt we'll put that much away each month. If may seem reckless, but I'd rather spend on having a good quality of life and really enjoying the kids' childhood than live frugally and put money aside for a rainy day which may never occur. That said, we both have excellent job security. If we worked in industries where redundancy was a real possibility, I'd think very differently.

I wish, I cannot afford to save anything at all most of the time, nevermind 20% of income. My savings account currently has 500 quid in, and thats the product of a few years worth! I have standing order setup to try and save automatically, but come halfway through pay cycle I tend to switch it back to main account as we need to buy/pay something

I think it all depends. Most people could save something if they tried.
It might mean cutting back on things people see as a necessity like a holiday, new clothes, upgrading cars, entertainment (new phones etc.)

We were never in any debt apart from paying off a mortgage. I ran a car till it was 15 years old and we didn't holiday overseas.

I'd not bank OP on waiting to save when your kids are older.

At one stage we had 2 at uni at the same time and were paying accommodation for each- equivalent to 3 mortgages. That was the only time we hovered over being in the red each month so we had to be careful.

We save about 25%. We have a good income between us, always been good savers and luckily never had any debts except mortgages.
We've been able to invest in property by buying our first home years ago and using inheritance to buy our holiday cottage. The equity we now have as far outstripped any income from savings.
I think saving for the sake of it is a middle class pastime. Enough income to put some aside without doing anything rash.

Ignore me. I misread that you were same job. Not similar earnings. Muppet comprehension skills!

We save approx. 25% per month and are looking to increase that. We have a separate savings account for our house deposit, and are currently saving to cover the increase in costs to go from a 2 bed apartment to a larger house.

I am due a promotions and significant pay rise this year, so I will be saving all of that increase. Mid year we are also planning to reduce costs further to live off one salary to prepare for future maternity leave etc.

Powerbunting - thanks for your concern, but I probably wasn't 100% clear in my post. I'm the one employed by the NHS, with an NHS pension (so paying in 9.2%). My husband is employed by a private company and paying into a pension organised by them (13% paid by him, first 3% matched by employer). You're right though, he'd have a much tastier pension if he was also NHS. He also didn't start paying into ANY pension until he was 26, which is why he decided to go for 13% to try and play catch-up (I'm still not 100% sure where he picked 13% from, but I think I'd mentioned to him not long before that I'd read somewhere that you should pay 1/2 your age when you start contributing as a percentage. Maybe he does listen to me sometimes after all ). We're also filling up our LISAs to help bridge the gap between 60 and state pension age and contributing to S&S ISAs to use before 60 if we decide to retire early. Fingers crossed it all pans out.

I have some savings, saved when I was a little bit richer, back when it was sensible to save and the banks gave you interest.

Now, I think there's little point, banks don't give you anything for it and it's better to invest money in things that you know are going to go up in value and that you know you will definitely use down the line. Brexit remember. If the pound tanks and we have hyperinflation your savings won't go very far when 1 roll of loo paper costs £10+.

Powerbunting - crosspost. No problem! I do that all the time

Of course some people do.

I save masses because I live quite simply and have explicitly prioritised things like overpaying the mortgage as fast as possible (recognising I am in a very fortunate position with a well paid job)

• I save 22% of my salary as pension (by simply living on an old budget and ignoring payrises);
• I then overpay my mortgage by the max allowed (which works out to about another 20%
• And I also save probably another 20% as savings for things like holidays, car costs and 'big' household spending

My mortgage is my only debt, but it has not always been like this. Which may in fact be part of the reason behind my incessant need to save.

We save £200 a month which goes into our help to buy savers account. On top of that we were saving for our wedding which is now done so the money we put towards that will go to debts. I'm hoping to be debt free by Christmas 2020 and by then I'll have the chance to save about £1000 a month towards our house deposit. We don't have any savings that arent tied up in the help to buy so we'd need to rely on credit cards if anything happened

I save 40% of mine but have no kids. I expect if I did, I probably wouldn't save anything at all

Actually just worked out that I spend 20% of my take home salary on my horse. If I didn’t have her I’d definitely be able to save 20%. But I’d be a very bored sad sack, so I’d rather spend it and be happy!

Thanks for all the replies . Definitely some food for thought.
I have down loaded an app to help track the finances and that's what has me thinking.... where is all our money going ?
We're not well off, but we definitely shouldn't be as broke as we are at the end of each month.
Literally living pay cheque to pay cheque.
Hopefully this is my wake up call. Things are going to be tight this year, as I try to get on track, but it's absolutely necessary and I'm going to make it my priority !

Yes, we do. I save £400 of my take home £1600 per month. OH saves around £800-1k or so of his £2k take home. I also have a lease car which is about £300 so if I didn’t have that I’d be able to save even more (it comes out of my salary before I get paid) but I’d have to spend on running a car anyway.

I mention the numbers not to brag but to highlight that the only way we’re able to do that is because we have what I would consider fairly good incomes. It’s only in the past couple of years I’ve been able to start saving properly, same for him, as we’ve finished lengthy courses of study and obtained professional jobs. It also helps we live in a low cost of living area, and don’t have kids. We’ve purposefully delayed having children to focus on working as hard as possible and saving as much as we can before they come along. Hopefully by the time our first comes along, all being well according to our timeline, we will have around £30k min saved, but that’s for a mortgage as well as the costs of children.

I’d we’d had kids any earlier than we are planning to we would be in a very precarious financial situation. Partly because we’d not have been able to study for the jobs we have that have fairly decent earning power with young children. You can only save what you have spare. If you’re on a low income with several mouths to feed or in a really expensive area, you’re pretty much fucked.

Gosh I think we're comfortable & have plenty for retirement -- but we don't accrue 20% savings/month.

I can live on peanuts, though, and will be happy to downsize once DC are settled into own homes.

Probably around 15% but have cleared mortgage and have no credit.

I’ve also been on the total opposite end of the scale earning £8k per year and in increasing amounts of debt. I never want to go back to that, which was part of my motivation to do everything in my power to try drag myself into a well paid career (neither parent went to university, one on NMW all their life, brought up in a sink estate) like voluntary work to gain skills, then applying for university and further qualifications, working 80 hour weeks to get by (I wish that was an exaggeration!). I didn’t grow up with the mentality of saving until I met my OH, who had grown up in a similarly poor family but was determined to be a saver. He helped me to change my perspective on it and for that I’m very thankful. I understand what a privilege it is to be able to save each month as I couldn’t get through the month without accruing debt for a long time due to low paid jobs and health problems that made it impossible to progress and almost impossible to hold a job.

A tracking app is a great idea OP!

I have a pension through work, and manage to save about 25% on my income at the moment, alongside saving 30% for yearly spending (allocated for birthdays, christmas, holidays, car mot/tax/insurance and some others)- worked out as a final amount per year needed split per month and trackable for what is spent and what remains..

I am in a very fortunate position with this at the moment as I live with my DP and the house is in his name and only wants money towards food/bills not house expenses as such.
Buuuut this is all going to change this year as we are moving and buying a house together, so the mortgage and bills will all become split between us.
I expect to be in a poor position once we move, with very little spare to go to savings unless I crank out the overtime at work; the OT money will go towards savings for mat leave in the next couple of years.
Current debt is a credit card on 0% until 2021 and will be paid off before the 0% expires..

I use excel for my financial budgeting, and find that having a table with my yearly costs very helpful and lets me work to a budget on it all, and anything left over goes towards a credit card or savings 👍🏻

I can live on very little. I cook from scratch buying hardly any convenience foods, eat less meat these days so only 3x per week, happy with cheap Aldi Merlot and don't smoke and don't dig labels/brands and don't visit beauty salons apart from hair foils every 2 months.

I don't mean that I don't splurge at times but naturally I'm a but tight!

Bit!

Assuming you're not totally on the breadline, saving is about priorities. Most people have at least one little luxury - if they cut this out or downgraded it, they would have more money to save.

The lower the take home salary, the more planning you have to do. If you're serious about saving, you should properly track your finances for at least a month, analyse where the money goes and decide if you are happy to cut down on anything or if you're already at the minimum standard of living that you're all comfortable with.

If you can't cut anything further, you need to look at whether it's feasible to earn more.

The higher the wage and the fewer the dependents, the easier it is.

In your case, I would slowly build a small nest egg for unplanned expenditure but focus on cutting down the debt as my priority. The rate of interest on the debt is probably much higher than the rate of saving interest.

Good luck!