Saving & investing

How much should you actually be saving?

There is no single correct savings rate. The useful number comes from working backward from what you want your money to do and by when, then checking that against what your income can support. Rules of thumb are a sanity check on that answer, not a substitute for it.

5 min read•Updated July 2026•By Austin Hunt, CFP®, CIMA®

Why the standard percentages feel wrong to high earners

The familiar guidance to save ten or fifteen percent was built around replacing a working income in retirement over a full career. If you started earning seriously in your thirties, or your income has climbed steeply, or you want optionality well before traditional retirement age, that framing does not match your situation.

High earners also face a quieter issue: a higher income means a bigger gap between what your paycheck covers and what public retirement benefits will replace. The percentage that works for a median earner is not the percentage that maintains your life.

Work backward from the goals instead

Start with what the money is for. A house in three years, tuition in fifteen, the option to step back at fifty-five. Each has an amount and a date, and each therefore has an implied monthly contribution. Add them up and you have a savings target derived from your actual life rather than from a magazine.

This usually produces one of two useful outcomes. Either the number is achievable and you can stop wondering, or it is not, and now you know which goal has to move. Both are better than a vague sense of unease.

Then make it automatic

Reverse budgeting means the savings come out first, on payday, and whatever remains is genuinely available to spend. No categorizing, no tracking, no monthly reckoning about restaurants.

It works because it moves the decision from hundreds of small moments to one annual one. It also has the pleasant side effect of making spending guilt-free, which is the part people do not expect and end up appreciating most.

Revisit it when your income changes

The most common leak is a raise that quietly becomes lifestyle. Deciding in advance what portion of any increase gets directed to savings is a small rule with a very long tail.

Once a year is usually enough to check. Life changes that warrant an earlier look are the obvious ones: a new job, a new child, a move, an equity event, or a goal that turned out to matter more than you thought.

The short version

Generic savings percentages were not built for high earners or compressed timelines.
Deriving the number from dated goals turns a vague worry into a checkable figure.
Automating contributions on payday removes the need for month-to-month discipline.
Pre-committing a share of future raises is what stops lifestyle from absorbing them.

Talk it through with Austin

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