# average savings of a 35 year old



## tell me on

General query, whats the average savings of a 35 year old in Ireland today? Not an easy subject to discuss with most people so Ill try this method. 
35, no mortgage, single etc,


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## Brendan Burgess

It would be impossible to give any meaningful answer to that question. 

The savings of someone in a profession would be different from someone in a trade. 

Some will have pension schemes, others won't. 

And what does the average single person with no mortgage mean? 

Many have mortgages, so why exclude them? 

The overall range would be huge from people in very big negative equity to very wealthy business people.

Brendan


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## tell me on

Thanks for your reply. I understand the variables would be large. Lets say a 35 year old, renting, full time employment etc. Its a general question and I'm interested in certain aspects of replies as in people in a similar situation to myself perhaps. I appreciate all input.


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## aristotle

Hard to say. It might not be a bad place to start by saying you should have saved the same amount as you earn in a year gross. Eg
If one €50k gross then should have that in savings. 

And if you have more in savings that the mileage on your car then you are also probably doing well!


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## tell me on

The mileage sum would be time to retire, I wish. It is hard to say and when I talk to friends its difficult to know when the joke stops and get serious about comparisons. I know one guy 39 with over 400k in deposit accounts and he has a small mortgage.


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## aristotle

I mean that guy at 39 with 400k - has he a pension, property, mortgages, kids? The better question is what is his net worth. 

Lots of people made money through the Celtic tiger, so did he make 400k by savings or by selling property etc?


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## tell me on

One property, small mortgage, no kids. Accountant (not a surprise). All his cash is from savings and he earns around 60k/year. Another guy, 39 also, no property, no kids says he has 20k. Seems to be vast differences!


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## Marc

How about asking the question a different way?

How much "should" you be saving?

A good rule of thumb is a percentage of your income that is half your age.

I've used this rule in planning meetings for the last couple of decades and it works reasonably well as a way to establish a relative reference point.

So a 35 year old should be saving around 17% to 18%pa of their income.

Maybe that helps..


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## tell me on

Thanks MARC. You're right, thats a better way to put it I guess. Some people I know cant seem to save anything and people in similar situations can save up 60% of their net income


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## aristotle

Saving 400k after tax on a gross income of 60k over say 20 years seems nearly impossible. Factor in the first 5 years at least of earning a lot less than 60k. 

Either the guy is a complete frugal or has additional income or has made lump sums doing something else or got inheritance/gifts.


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## tell me on

Thats why I started this discussion, its difficult know but he seems like he is being truthful. I wanted to put the feelers out there to get an idea of savings of people in similar situations. 
The person I deal with in a bank told me recently that its mainly guys working overseas that are saving large sums, some are sending up to 50k/year home. I would have thought that alot of people with no property, no kids and not a very expensive life style would have at least have over 100k in savings


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## Joe_90

I'd look at it a different way.

Someone earning €50k per annum nets €34,870.  So what does it cost to live on €25k+, so €10k for 10 years is €100k.


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## AlbacoreA

If they are single with no other obligations.


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## RainyDay

Marc said:


> How about asking the question a different way?
> 
> How much "should" you be saving?
> 
> A good rule of thumb is a percentage of your income that is half your age.
> 
> I've used this rule in planning meetings for the last couple of decades and it works reasonably well as a way to establish a relative reference point.
> 
> So a 35 year old should be saving around 17% to 18%pa of their income.
> 
> Maybe that helps..



Aren't there too many variables to have a simple rule of thumb?

If you are a professional who is required to heavily invest in their career over this time (such a doctor or solicitor setting up a practice), then you're not going to be doing a whole lot of saving. 

Or if you have just bought your first house, you're probably not going to be doing a whole lot of saving.


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## Fella

Theres no such thing as an average 35 year old! Most people I know are broke. I don't think theres any simple rules either , save what you can and enjoy your life , I think the majority of people are probably just getting by, i'm lucky enough to be saving alot of money at the moment because I have it but that may not always be the case. Creches mortgages etc make saving out of the question for most people , I don't think this government want us to save anyway they tax us to death then tax the bit you have left with dirt tax , really is a joke of a country.


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## tell me on

Its not that bad, there are always opportunities if you work hard. Anyone got advice on how to meet people that want investment of time and money in their business and not dragons den


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## Jim2007

Marc said:


> So a 35 year old should be saving around 17% to 18%pa of their income..



That is a good rule of thumb.  If I look at Swiss pension law: you join at 25 and start contributing 6-7% which is matched by the employer so total 12-13%.  At my age I'm paying in 13%, which is matched by employer, so about 25% in total.  So in all cases about half your age.


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## Jim2007

aristotle said:


> Saving 400k after tax on a gross income of 60k over say 20 years seems nearly impossible. Factor in the first 5 years at least of earning a lot less than 60k.
> 
> Either the guy is a complete frugal or has additional income or has made lump sums doing something else or got inheritance/gifts.



Actually it is not that unreasonable, if you invest in equities rather than the Irish mantra of property, property....

He has the right background in accounting/finance, so he should be able to construct a reasonable portfolio that returns 9-11% on average pa, that plus regular savings contributions would do it.

Averaging 12.5% pa would mean he doubles his money every five years.  At present there are some solid MNCs pay dividends of 4-5% in dividends, add some capital appreciation and regular saving contributions and he'd have a good chance of achieving it.


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## mandelbrot

Jim2007 said:


> That is a good rule of thumb.  If I look at Swiss pension law: you join at 25 and start contributing 6-7% which is matched by the employer so total 12-13%.  At my age I'm paying in 13%, which is matched by employer, so about 25% in total.  So in all cases about half your age.



Jeez ok Jim, we get it, you're in Switzerland and its the business, change the record! 

Unless you're 26 then I don't see the validity of that statement to a country where very few people have access to a scheme where the employer matches the employee contribution. 

Unless of course we should all move to Switzerland, which clearly we should because as you never tire of telling us, it's so fantastic


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## Jim2007

mandelbrot said:


> Jeez ok Jim, we get it, you're in Switzerland and its the business, change the record!
> 
> Unless you're 26 then I don't see the validity of that statement to a country where very few people have access to a scheme where the employer matches the employee contribution.
> 
> Unless of course we should all move to Switzerland, which clearly we should because as you never tire of telling us, it's so fantastic



Well here is the thing they are a few years ahead on pension reform and their assumption is that by the time we get to pension age, those that are working will not be able support the pensions required, so we have no choice but save.  And that level of saving is expected to generate a pension of about 40% of annual salary! I don't see that as very exciting!

It is also a problem that faces most European countries in the next decade, so the OP's question on how much he should be saving is an interesting one...


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## Bronte

mandelbrot said:


> .
> 
> Unless of course we should all move to Switzerland, which clearly we should because as you never tire of telling us, it's so fantastic


 
Well they are streets ahead on money management. With a sensible approach to the pension time bomb. 

And I have a feeling they don't pay a penny for wasted water, with proper metering at point of entry to the house. You can be sure they aren't wasting millions on consultants either.

As an expat myself, I think it's important that others get a different perspective and way of doing things.


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## RainyDay

Bronte said:


> Well they are streets ahead on money management. With a sensible approach to the pension time bomb.


And they have recognised the need for modest wealth taxes on all worldwide assets too;

[broken link removed]


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