Finance Magazine

Resolve to Save Half Your Income in 2016

By Kathleen O'Malley @frugalportland


Do you set resolutions/intentions/goals? Or is January 1st “just another day” for you?

I can go either way. On the one hand, I love setting goals. The more ambitious, the better. I like saying that I’ll accomplish something big by the end of 12 months, then setting goal posts and checking in… and doing it.

On the other? I am human, and get discouraged easily. I resolved to do a pull-up two years in a row, and I still can’t do one. One year, I said I’d run 365 miles, and by the end of January had only run six, so I gave up on that one too.

Sometimes, my goals are so ridiculous that I create loopholes. “Don’t eat out” turns into “…unless someone else is paying” and that makes me a person who resolved to be that friend. No.

But I do set financial goals, and I think you should, too. Max out your IRA. Contribute at least as much as your employer will match to your 401(K). Pay off those credit cards once and for all. Need more ideas? Here’s a post from last year: 30 Personal Finance Resolutions for 2015.

Resolve to Save Half Your Income

I have been saving half my income for the last three years, and it has made all the difference in the world. It has become the cornerstone of my financial philosophy.

Here are some of the most popular posts about saving half your income:

why putting 50 of your income toward debt is better than saving

Read the whole collection of articles here: Save 50%

Why Save Half Your Income?

You should aim to save half your income for a number of reasons:

  1. It sounds hard (it is hard, but doable)
  2. Saving half your income gives you a lot more options (you could work less, travel more, retire early)
  3. Attempting to save half your income and not quite getting there is the best kind of failing. I mean, who’s going to kick themselves for only saving 45%? Not me!
  4. Saving half your income means you don’t have to worry about our fickle friend, willpower

Need a Little Help?

One thing I’ve noticed since I’ve been spreading the good word (okay, proselytizing) about saving half your income is that people have different versions of one response: “I wish I could do that/That’s not in the cards for me/Must be nice to make enough money to save that much.”

Which I always thought were flimsy excuses, until I did a bit more digging.

It turns out, people want help figuring out what counts as savings and how they can find enough room in their budgets to save half.

So, with Joe, I created a five-module course.

It’s one I’m really excited about, and one that can change your life (in all seriousness).

It’s Save 50, and it launches today. Registration closes January 29th, so make this a resolution you can keep.

There are 14 lessons in those five modules, each designed to help you take things a step further.

We worked with Tiller to come up with a KICK ASS spreadsheet that pulls information from your bank and helps you figure out how close you are to the 50% mark.

The cost for the course is $129, and it’s worth a lot more. Especially if you do the work and open your mind to the possibilites of adjusting your life so you can save more money.

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