How exactly do I calculate my personal savings rate for FIRE?
Savings rate is the percentage of your take-home resources you keep and invest. A common formula is annual savings divided by annual take-home pay, where savings includes 401(k) and IRA contributions, any employer match, HSA deposits, taxable brokerage investing, and extra principal paid on debt.
For FIRE math, many people use a gross-based version: (total savings + pretax contributions) divided by (gross income minus taxes). Be consistent so you can track the trend. Example: if you net $8,000 a month and invest $3,200, your rate is 40%. Small definitional choices shift the number, so pick one method and stick with it. WealthSerene's Budget Analyzer at wealthserene.com/tools/budget-analyzer helps you find spending to redirect into that savings figure.
Educational disclaimer: All content on WealthSerene.com is for educational purposes only and does not constitute investment advice. Projections and calculations are illustrative — actual results will vary based on market conditions, your specific situation, and many factors outside this tool’s scope. Always consult a qualified financial professional for advice specific to your situation. View full disclosures →