To think saving half of all incoming money isn’t excessive?

[KeenOchreUser]

I was chatting with some friends about money recently (note to self: never again), and mentioned that I try to save half of everything I earn or receive, whether it’s my salary, bonuses, or monetary gifts. One friend said this was excessive and hinted that it might reflect some deeper issues with money!

I was so taken aback that I didn’t even know how to respond. To me, this seems like a responsible approach. AIBU to think my friend’s reaction was actually the over the top one here?

I've always saved 10% of incoming money because that's what Rich Richard on Friends told Monica to do and it stuck (probably shouldn't take financial advice from sitcoms!).

It's fine as long as you arent missing out, forcing yourself to live on beans and toast, actually with the price of beans maybe a better example is cheap ramen and you dnt complain to that friend about never having any money then it's fine.

The friend is correct though that hoarding money, like hoarding anything can be a sign of deeper issues, especially if that person grew up without money or constantly worrying about it and never actually spends it.
A bit like pensioners who are well off being too worried to put the heating on.

it totally depends on your income and outgoings. It's so individual. I just think it's unusual as many people these days really struggle to pay the bill and will have nothing left to save.

It's a good discipline and habit to get into. PROVIDED you are living a decent enough life and don't rely on a can of beans n toast every day, rarely go out to meet friends/family/don't have holidays/rarely buy clothes and so on. Well I'm not saying those are necessarily BAD things, but if you are miserable, that's not worth it IMV. If you are happy and content, that's A ok.

I'm a huge saver. I think I probably save/invest about 50%, but this is because our income is fairly high and outgoings fairly low. It's an immense privilege to be able to save this amount!

I do think that perhaps I have a slightly unhealthy relationship with money though. I like the feeling of financial security because it gives you freedom and just makes life easier. However I think I could have 5 million in the bank and still not feel totally secure or like it's enough. The psychology of money is weird.

Indeed. But, just to wind that person up even more we do this, and we are in our 50's which another poster suggested we shouldn't be doing at our age I assume because we are so near to death! We do it because we are of a savings mindset but also what would be the alternative - spend it on unwanted stuff just to stop it being put into savings? As others have said, if it really is spare and you are eating and being warm and having some treats and holidays then why not.

@Singleandproud Hey, there is nothing wrong with Ramen. Nissin ramen is my staple.

I think you're doing really well and that you shouldn't worry about their reaction. Saying that, I was encouraged to save from a young age by my family. What you're describing sounds normal in my community (saving as much as possible, even when i was earning minimum wage) and I've learnt over the years that this is kind of rare.

It's probably a good idea to avoid discussing money with friends if that's how they've reacted / if their reaction is making you feel weird/insecure!

You sound very sensible to me.

If you are 50; own your own home, what are you saving for? Old age and care costs, presumably.

I suppose it really depends on your other conversations with that friend. If you spend a lot of time talking about costs, saving money, ending up being subsidised by friends to do something because you say you don’t have the money, not being able to do something because of money etc etc then I can see why she might think you have an issue

Not specifically saving just for a house, but I am aiming for financial stability in general. And yes, the 50% does include pension contributions, but I still aim to save a solid chunk after those too. I understand it might not be sustainable forever, but it’s a habit I’ve built that works for me right now.

In your situation, I think YANBU as it sounds doable with a few compromises. I think it would be a shame if you lived with no small holidays/meals out though although absolutely your choice.

I can't save basically anything as it's all eaten up with bills etc. I do own a house and have 2 DC so I just accept this is how it is at the moment and at least i'm stable.

@KeenOchreUser if you'd posted on the money section, you'd get different responses

some people don't like to save even when they can. You do you. I'd be careful talking about it with friends though.

I didn’t grow up without money or constantly worry about it, nor do I avoid spending it. But not too long ago, I received a settlement due to being poorly treated by an employer and was out of work for a while. I lived off half of it and put the other half away. Before that, I saved 30% of my monthly pay. After being out of work for a bit, I landed my current job, which pays more than my previous role, so I decided to increase my savings to 50%.

I’ve always squirrelled money away and gradually increased the percentage as my salary grew.

In that case, I'd say save while you can (but of course, there a balance between now and future), it'll help smooth the ride through life. Although, from security point of view, I'd be nervous about the government thieving it away through, this lot seems to think they have the rights to other people's money.

Depends what you mean by save. If you save half into untouchable money that's different to say saving for more immediate things like holidays. Plus depends on what you want, if you earn £2000, it's probably a bit excessive. If you earn £10,000, less so.

I'm personally more of a live in the moment type. Good pensions, good insurances, mortgage, save in advance for Christmas, cars, holidays, etc, but don't save excessively into a rainy day pot.

I think you’re right that not everyone sees it the same way. I’m definitely starting to learn that discussing money can bring out a lot of different opinions. I’ll keep that in mind going forward for sure.

It depends on your circumstances. I rent with my partner, we both save half of our income towards a house deposit. We don't have kids and still have meals out, treats, a holiday etc so I don't think it's excessive in my circumstances really

It’s a privileged position to be able to do so but if it works for you then great.

But I would be careful to not focus on saving for the future at the expense of living today

I mean I’m a saver but 50% is incredibly high.

It’s slightly different with you bing single and trying to save a deposit, it’s a relatively short term thing.

On most incomes saving 50% of your income just isn’t sustainable.

What's your income after tax? If you're earning £10k a month then that would be expected.

@KeenOchreUser

Have you been composing to that friend of having no money, not being able to go out with them because you can't afford to, not buying gifts for weddings, new babies?

it's fine to prioritising savings over those things, but it's not fine to accept that's what you're doing and say you'd rather not spend money on those things, but is shit if you've been claiming to not be able to afford it.

as a single person with no partners second salary to share the expenses with, I personally find it harder to save than my coupled up friends (basic maths). Theres absolutely no way I can afford to save anything like 50%.

Never discuss having lots of money or savings with other people. Money is divisive . I always make out I'm more hard up than what I really am . I have money invested and a pension but keep it to myself . I will never forget some backlash I got at work for telling people at work my mortgage was paid off . I was stopped from doing overtime . Lesson learned.

I don’t feel comfortable sharing the exact figure, but I can say that I live within my means and save a portion of my income regardless of the amount. I think it’s more about having a mindset of saving rather than the exact salary.