Author: Mr and Mrs DDU.
Perhaps the most important factor for how quickly we can reach financial independence and retire early is how much we save. The difference between saving $30,000 and $40,000 a year can snowball significantly over a decade.
We aren’t trying to save every last cent we can. We want to enjoy our lives and experiences now, not just when we reach FIRE. However, at the same time we recognise that living a simpler life means we save more, it also means we don’t need to accumulate as much wealth to afford the lifestyle we want of living off only our investment income.
We are currently aiming to save around 50% to 60% of our net income.
Most of the money we are saving is being split between our house fund and investments. We post any articles about our money savings choices or habits here.
April 2022 Savings Update
Dividend Income: $2953.27
Regular Income: $9,399
Adsense Income: $0.00
Total Income: $12,352
Savings Rate: $8,150
Savings Percentage: 66.0%
Here is the graph:
We invested a total of $7,000 of our savings into shares (not including any Dividend Re-Investment Plans). We added $0 of this month’s savings to our house deposit.
Here are the changes compared to last year:
April 2021 rate: 75.8%
April 2022 rate: 66%
April 2021 savings: $11,464
April 2022 savings: $8,150
Dividend Income – In April, we received $2,953.27. Our dividends covered 70.3% of our expenses.
Regular Income – This is the after-tax figure if you’re wondering. It is the combined figure of both our incomes plus any bank interest we have received. This amount also includes any government payment(s) we receive now that we have Little DDU in our life. Our superannuation (payments made for our personal retirement – sort of like 401k in the US or NEST in the UK) contributions are not included in our income or savings rate, but do help our long-term wealth.
Google Adsense – As the name suggests, it’s when Google makes a payment for advertising on the blog. We received a payment in November. Thanks for reading the blog and keeping the ‘lights’ on!
Here we go, non-regular expenses that happened this month:
Car parts – As we alluded to last month, we needed to replace some parts on our car. We spent $492 on this.
Paint for furniture – We decided to buy some furniture second hand and update it instead of buying new. We love that we can get solid wood pieces and it is a more environmentally friendly choice than buying new.
Here are our two savings tables since we started blogging showing the savings rate % and the savings rate in $ terms:
We weren’t going to repeat the huge savings from 2021, but we did still have a great month thanks to the dividends. Those dividends were re-invested back into more shares.
The 3 key factors for us to become wealthy are:
- How much we earn
- How much of our earnings we save
- How hard we can make our savings/investments work
These monthly savings posts will track how good we’re doing with the first 2 factors.
How did your savings go in April?
Thanks for reading this article about our financial journey Down Under. Onwards and upwards!