This tool helps you understand what portion of your income is being preserved for the future. Tracking your savings rate is the first step toward long-term financial security.
Your Estimated Savings Rate:
20%
A higher savings rate typically accelerates your journey toward financial independence. Increasing your rate by even 1% can shave years off your working career.
The savings rate measures the percentage of your disposable income that you set aside for savings and investments.
Formula: Savings Rate = (Monthly Savings / Monthly Income) × 100
Example: A household with $6,000 monthly income saving $1,200.
Financial experts often recommend a 20% savings rate as part of the 50/30/20 rule.
Using net (after-tax) income provides a more accurate reflection of your actual spending power.
While some include debt principal, it is usually best to focus on liquid savings and investments.
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