<p>I am curious because I was talking to another parent and she said they don’t have money to pay for their kid’s college. Good thing her d is an exceptional student and received a full ride, since she won’t get any help from them. I knew they went on two cruises last few years, and she had elective plastic surgery a few years back. When the husband lost his job last year they were worried about loosing their home. </p>
<p>In contrast we had never been on cruises, I never had plastic surgery though I certainly need some, but we saved enough to pay for college and the house is paid for. Right from the beginning of our marriage we determined how much savings we want out of our income and put it aside, whatever was left determined how we lived. We have decent but not high income, since I seem to be in and out of work a lot (because of children). Before we had kids we saved about 1/3 of our take home pay. After the kids were born it became much harder and we saved only about 10%. We shopped at dollar store a lot. Tried not to own a car if we can. Lived in a 600 sq ft apartment with 2 babies till we had enough to buy a home.</p>
<p>We could be much better savers, but have a house (bought when had 2 incomes) that takes a very large percentage of salary. </p>
<p>That being said, I still shop at yard sales for almost all my clothes (in upscale areas w/indulged teen girls…there are tons of pristine clothes for $1 each), buy home furnishings at yard sales also and shop sales for food.</p>
<p>That’s great that you are able to save and <em>plan</em> w/savings in mind, munchkin!</p>
<p>H and I are pathological savers. We are passionate about living below our means, in order to have more choices in the future. This path enabled him to leave medicine and make a third of what he used to without stressing us economically. It may make it possible for me to cut down to part time work in the next year or two, also, so I can write more.</p>
<p>For us, time is much more important than things. We save to have more time.</p>
<p>DH and I have a good income, but high maintenance children! We saved from day one of our marriage, long before children were even a thought. Most would say that we have lived below our means. We will have two in college at once (twins) and I believe that we have saved enough to pay for a good part of their education. However, with the current state of the economy, we have certainly lost money on a number of investments, and so we will investigate whether merit money will be available to them.</p>
<p>We save between 11-12%. I save 7% directly from my paycheck into my 401K (and my employer matches that), and then another 3% for college savings, most of that into a 529, and some into a separate mutual fund. Hubby puts some money into an IRA whenever he can, and that accounts for the rest. (He’s a musician, so doesn’t make a lot at the moment.)</p>
<p>Doesn’t thriftiness lead to good savings ? </p>
<p>We used to have one of those “indulged teen girls” - she indulges herself ! It led to a lot of friction during those years. She’s 19 going on 20 and is much better, ever since she had some jobs.</p>
<p>DH is a much better saver than I am. Thank heavens for the balance. If not for him, we’d be looking at big loans to pay for college. If not for me we’d be watching TV with rabbit ears (and lousy reception) and driving rusty 18 year old cars with non-functioning air-conditioning. </p>
<p>We don’t try to save a set %. DH’s company contributes to his defined-contrib pension plan. I have a 403-B. Years ago we started putting aside X dollars per month in college accounts, each year when we get raises we figure out how much we can afford to increase the monthly college savings.<br>
Right now we’re putting about 11% of our gross income into the college accts, and 20% of my pay into my 403B. </p>
<p>Basically our philosophy is: if we don’t need it or won’t make really good use of it, we don’t buy it. If we are going to buy something, we try to get decent quality (not the cheapest, but not the fanciest either).</p>
<p>Sometimes I think we save too much or perhaps I should be working full-time instead of part-time. We recently went to a party at my neighbor’s house. I hadn’t been inside the house in years and I was shocked at the work they’ve done, how beautiful it is and how PRACTICAL. They removed some walls and re-arranged the kitchen, the whole house feels so much larger! Plus my kids say they won’t have friends here because we have “nothing to do.” My D bugged us to get a pool for years (DH said NO). We always thought of stuff like pools or video game systems as frivolous, but now I realize that perhaps some of it is worth it so the kids would hang out HERE with their friends and I could keep an eye on them and enjoy the company. (We’re not complete luddites, we have a PS2 and Guitar Hero). This spring our D convinced us to buy a cheap pool table, and it’s given us all hours of fun. We’ve always said that after college is paid for we’d get a screened in porch, update the kitchens and baths, maybe get a hot tub… but now I’m seeing that maybe we could have been enjoying that stuff all along.</p>
<p>On the other hand, I just paid a very large fall tuition bill with a single check. No loans, no aid, no worries. So maybe DH was right after all…</p>
<p>DH is a great saver. He says I’m a tightwad,lol. We have been blessed for him to work for the same company for 27 years. We live comfortably but are not wealthy and lived very practically so I could stay at home with the kids. I do a lot of shopping at Goodwill. Both kids have worked since age 16. Our vacations have always been instate car trips (no cruises and my kids have never been to Disney World!). Our last vacation was 4 years ago. I went back to work part-time 5 years ago when youngest was in mid. sch. We do have one car payment and we have cell phones and cable TV. We never eat out at expensive places and have lived in the same house for 20 years. Over the years we have managed to save the equivalent of instate public u. costs for our two sons. Thankfully both are happy to go there (S1 on fullride…yay). Our house is paid for.</p>
<p>I love when this topic comes around (which it does about once a year or so…). Makes me appreciate my “non-spendthrift” bretheren. We have worked hard and saved carefully for a very long time, which allowed $$ to accumulate and gives us the comfort of financial security and lets us make choices as to how and where we spend our $$. We believe in education so have paid for private school for a very long time. I jokingly say it was practice, and made it less painful to have to write the bigger college tuition checks. Good news…thanks to DS#2’s scholarships, his college payments should be less than private HS!! </p>
<p>I agree with the OP-- it really grates on me to see people handling their finances poorly. It is their choice, but learning financial management is very important. There is a big difference between people trying their best to handle limited funds or financial adversity vs those who spend foolishly and then cry poverty. Maybe we should make toddlers listen to the story of the 3 little pigs more often and learn the value of good preparation.</p>
<p>I am a law firm partner, so any “pension” I have (the 401K) is 100% paid for by me. I always max that out and it’s about 15% of my before tax income. I also pay 100% of my other “benefits” so health insurance takes a chunk. Then there’s federal income tax. We opened 529 plans for the three kids as soon as we heard there were such things and we put quite a bit in them…but the money has to be divided three ways. With all the saving we’ve done, if son gets decent merit aid, there will be enough money in his 529 for about two years at a private LAC.</p>
<p>H and I are very thrifty except for one splurge area (travel). We’ve lived in the same house for 20 years and we drive cars until they disintegrate. (It never seemed like a hardship since I truly didn’t care about cars and houses that much.) For a while we saved more than 40% of our income, between retirement, college savings, and just extra savings. We always saved any bonus money that came along, too.</p>
<p>Then I lost my high-paying job and there went 70% of our income! Luckily I found another job but I now make less than half of my old salary. Even so, we still save about 15-18% of our income (mostly in 403b’s), and although I resent my previous employer for the RIF, I am so glad that we saved all that money! During the “good years” we managed to completely fund my D’s college fund, and that 20-year-old house has a mighty enticing (low) mortgage payment.</p>
<p>We max out on dh’s 403b which is matched by his university. I put max into an IRA the years I wasn’t making much, but now make enough to use SEP I set up years ago. Our house is probably our biggest savings though - even with the market downturn it’s worth more than twice what we paid for it in 2000. We inherited some money and it is paying for college educations and will eventually pay for a master bathroom, upstairs laundry and slightly larger kitchen. When I can bring myself to fork over the $250,000 or so I think it will cost. Ugh.</p>
<p>We live in the house I bought right out of law school. It would be paid for but we splurged and got a home equity loan for a pool a few years back. My husband drives a 1994 vehicle with about 250000 miles on it…I keep telling the kids that in a few years it wil be "vintage.’ I so want a master bathroom remodel, but son is driving that, if you know what I mean.</p>
<p>We have a pair of these ourselves! We don’t consciously save X% (except for retirement). But we aren’t spenders either–3 cars with 500,000 cumulative miles on them, house that was bought almost 20 years ago and almost paid off, not much into big vacations (although H travels internationally on biz and kids go international for music trips–part of their high maintenance) or remodeling the house (it is SOO 80s). So living below our means = money available for investment. We’ve doing this for 17 years, have managed to graduate one kid without loans and are ready to start on kid 2 next year.</p>
<p>Of course, we have been lucky also–no unemployment, no major illnesses, no major accidents, no one else counting on us for $$$.</p>
<p>My husband is almost religious about saving. We make sure to max out our pension/401K contributions, and saving for our kid’s college began at birth.</p>
<p>We also keep our cars for as long as possible. I rarely buy clothes and my daughter laughs at me sometimes (so what!). On the other had I have a few spending vices (which I would rather not detail.) No one is perfect. I think it is important to “pay” the savings items first, then you can have money for extras (if left over).</p>
<p>Years ago, my fellowship to business school included a job working for the then Dean of the program. Priceless as they say in the commercial. He stressed the low savings rates of the country as a problem then, with little to no fanfare in the news etc. The other thing he also said was investment in domestic industry was too low. I wonder what he would say now. Unfortunately, he passed away some years back at too young an age. I never got to thank him for some really valuable advice.</p>
<p>Speaking of good ideas from years ago, back when I was in law school, they were saying that social security was in trouble, not funded as an insurance plan would need to be etc. Did you ever hear of that 25 plus years ago?</p>
<p>Both H and I max out our 401(k) contributions, that’s pretty much it for now. H thinks his stock options will be worth something in the future :rolleyes: and does not think twice before handing his AmEx card to a Home Depot cashier! I’m amazed we actually saved a few bucks in the kids’ college tuition fund.</p>
<p>I remember that there was a tax increase in the 1980s (GHB times, I think) that was supposed to take care of SS–get the program on the right footing. Doesn’t seem to have worked…</p>
We saved from day one of our marriage, long before children were even a thought. Most would say that we have lived below our means. We will have two in college at once (twins) and I believe that we have saved enough to pay for a good part of their education. However, with the current state of the economy, we have certainly lost money on a number of investments, and so we will investigate whether merit money will be available to them.</p>