How much of paycheck do you actually save?

I know it's pricey living in places like NYC, San Francisco and L.A. ... but when you guys got your first FT jobs, did you actually make/budget enough to save any money? Or in these cities, are beginning salaries basically just enough to tread water?

Region: 
United States - West
United States - Northeast

Comments (26)

Oct 11, 2018

So I'm in a fairly expensive city and I aim to save 60% of my paycheck. I track savings in excel and try to stay on target, but have fallen back a few times and had to over-save to stay on track.

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Oct 11, 2018

60 percent? Whoa, impressive. Any tips regarding stealth things that might not be obvious, but that you've found you can cut back on?

Oct 11, 2018

Honestly people just need to realize everything costs money, and most things cost more than you would expect. $12 here, $9 there, and $25 somewhere else all add up and it adds up fast. Just know that a short excursion to a golf range or grabbing a few beers will cost you more than you think. Also buying coffee at starbucks and pret was running me around $50 a week, so had to drop that habit quick and only drink office stuff. Also things you dont need but want. Wanna cop a third pair of sleds? Think about it for a bit after checking them out. Maybe wait a little longer before buying that watch you walk by every day.

On a side note I do not pay much in rent due to a special circumstance, so that really gives me an unfair edge in saving. Still tho, its all about discipline.

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Oct 11, 2018

Don't buy a Ferrari after your first year

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Funniest
Oct 11, 2018
BillMurray:

Don't buy a Ferrari after your first year

Exactly. Buy it before your first year.

https://thumbs.gfycat.com/BaggyPaleCarpenterant-max-1mb.gif

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

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Oct 11, 2018

Oh shit, I should have clarified. Thanks!

Oct 11, 2018

Now you tell us...

Oct 11, 2018

I bank one paycheck a month and the other goes towards rent / food / gas. (Usually have a little bit leftover for other stuff). I've also started cooking at home / making overnight cold-brew which helped cut down on daily $10-15 lunches + $5 coffee.

I live in a low COL city, but I also don't make IB money either so it probably comes close to netting out.

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Oct 11, 2018

I save over 70% of my income. I live in a tiny flat which cost less half that of your standard LA one bedroom. I can cook well so barely any food expense. Aside from my watches, I barely spend any money. I satisfy my urge to buy stuff by buying stock and bond, an extremely effective way to curb my spending habits.

Cash and cash equivalents: $138,311
Financial instruments and other inventory positions owned: $448,166

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Oct 11, 2018
Duc-Ho:

I can cook well so barely any food expense.

I can cook too, but food is still 2.5-4K/mo for me.

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

Oct 11, 2018

Do you go out a lot? My largest monthly food expense is my stash of La Croix, aside from that I can feed myself for less than 180/month. SB for the handwritten note thing btw.

Cash and cash equivalents: $138,311
Financial instruments and other inventory positions owned: $448,166

    • 1
Oct 12, 2018

Yes, this is what I look forward to buying -- stocks. And after day like today, I look forward to buying stuff on sale!

Oct 11, 2018

I get paid sporadically so I try to save as much as possible and live quite frugally given my net every year. Probably invest 80% of what I make.

Oct 11, 2018

Smart man.

Cash and cash equivalents: $138,311
Financial instruments and other inventory positions owned: $448,166

Oct 11, 2018

I have a cute bum too.

Most Helpful
Oct 11, 2018

Since you are asking about amount saved from your paycheck, I'm assuming you mean post-taxes and for my purposes I won't add back my 401(k) contributions...

  • 27% - Apartment
  • 23% - Discretionary (Food, Entertainment, all normal daily expenses)
  • 7% - Vacation/Travel
  • 43% - Post-Tax Savings

Hopefully as I make more that Apartment % will come down to more like 15-20% and Post-Tax Savings will get about 50%. Pretty happy that right now ~half is all my necessary living and then ~half is vacation + savings!

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Oct 11, 2018

I live somewhere dirt cheap (Cleveland) compared to the majority of WSO, but get paid Wall Street base (but not the same bonus). I saved about 60% of my income, which went to my 401k, IRA, and general brokerage accounts. I can save so much because rent is cheap, $700, and I don't own a car, which saves me another $300-400 a month. I spend about $500 a month on food, which mainly is buying groceries at a relatively pricey (but healthy) store, and the occasional eating out. I actually tend to not sweat the small things, like a coffee here, drinks there, decently priced sporting events, but really focus on keeping those large costs (rent, car, food) reasonable. "Penny wise, pound foolish" is a saying for reason.

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Oct 11, 2018

So many people justify spending a lot of money on watches, because they retain their value, even though they're not an income-generating asset. Did you know you can buy a high quality fake one from China for $100, no one will know it's real, and it also tells time?

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Oct 11, 2018

This is pretty obvious, but it's nice to think about your savings to spend ratio as "earning" retirement years. So if you save 66% of your paycheck, this means you spent 33%, for a 2:1 ratio of savings to spend. Since it only costs you whatever 33% of your salary is to live for a year, you've earned yourself two years of not work. Obviously this doesn't account for investment growth or COL changes, but it's a nice rule of thumb regardless.

I'm at a 1:1 ratio right now and hope to keep my living expenses constant as my salary (hopefully) increases. My dream is saving 75%... imagine having nearly 10 years' worth of living expenses after working for only 3...

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Oct 12, 2018
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Oct 12, 2018
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No pain no game.