Try Saving One Percent More

By Michael S. Brown on October 20, 2014
Categories: INVESTING

Want a nearly painless way to save more money?

Try saving just an extra percentage point a year. It doesn’t sound like much, but it can make a significant difference to your savings goals.

You can see for yourself by using a savings calculator on The New York Times’ website that is designed to show you what a one percentage point boost to your savings would do to your bottom line.

To use the one-percent calculator, you just need to share six figures:

  • Annual income
  • Current savings balance
  • Percent you save each year
  • Annual salary increase
  • Expected annual return
  • Savings time horizon

In the example below, I assumed that an individual had an annual salary of $125,000, had saved $225,000, had saved 10% per year, and had a 20-year savings horizon.

If the investor didn’t boost his/her savings, the nest egg, assuming a five-percent annual return, would end with a balance of $851,766 after 20 years.

If the saver boosted his/her savings by one percent, the portfolio value would climb to $903,377 or an extra $51,611.

As the graphic dramatically illustrates, you’d enjoy the biggest bang for your buck by increasing your savings rate by a percentage point each year. In this example, that led to an extra $256,496 in savings!

Check out the calculator for yourself. It could inspire you to nudge your savings higher. Chances are that boosting savings so modestly each year would hardly be noticeable.

Learn more…

 Don’t Be Fooled By the Calendar

Forget About Today:  Start Saving Tomorrow

Getting More Mileage From Your Retirement Portfolio


executive compensation analysis san diego

What is private equity?

Read Now
schedule a wealth management financial advisor san diego

What is Venture Capital?

Read Now
Entrepreneur talking on the phone while working on a computer

Demystifying Bonds and How to Get Started Investing in Fixed-Income

Read Now


Discover the people who make Dowling & Yahnke one of San Diego’s top wealth management firm.



Our team is available now to discuss all of your financial goals.