At the end of the month it is always good to look back and to see how you have been doing on the savings rate objective. I think it is a good habit if you are serious about financial independence. Especially if you are a late starter like me and quite new to the concept. By putting it out here, I hope to help others on their journey, but above all, it helps to hold me accountable towards my goals.
In May I ran a small experiment. At the start of the month, I have set aside approximately 5pct of our monthly budget. I wondered if we really needed. It turns out that this month we didn’t. Nice… I will repeat the experiment next month. Lets see what happens. This extra money is not counted as a saving, as it just rolls over from one month to the other. This principle is one that I use frequently. It think it is worth to document it once. Hopefully I have the time in July to do so.
So, lets jump into the numbers
We managed to save 55pct of our income. As you can see, tnis is right on target compared to the year goal. This is nice.
After some reflection on how to calculate the savings rate, I now also report another number. I am actually experimenting with a new definition of the savingsrate. I only count the savings that actually go into our investment account. So, what is the big difference here? That is clearly the mortgage and the build up in our future health insurance plan.
Is this better?
From a number perspectives it is not good. We drop from 55pct to 30pct. Let’s be clear, 30 pct is still above the Belgian average saving. I do think that this representation is better as it it now aligned with the progress that our F-money will make.