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Tag Archives: USA
Save like a developing country: Global savings rates around the world
The only data I’ve been able to get for all the countries at once, is for the year 2010. Luckily, it isn’t so far off from 2013, and the savings rates at a quick glance, haven’t really changed much from 2010, except in the fractions of percentages:
Here’s the chart I created in order of highest to lowest savings rates around the world for 2010
(Click to biggify anything)
China and India are the two towers of savings you see on the left.
New Zealand and Denmark are the two towers of not-saving you see on the right.
SAVE LIKE A DEVELOPING NATION FOR OPTIMAL RESULTS
It’s cultural as well, I’m sure, but China and India are blowing everyone else out of the water in terms of savings rates.
…OR AT LEAST SAVE LIKE SOME EUROPEANS
Aside from India or China, if we take a look at the next tier of double-digit savers from Turkey, France, Spain, Germany, Belgium and Portugal, their savings rates of 10.20% to 19.50% are nothing to sneeze at.
I received an email from a lovely reader (*waves!*) in Germany who told me that she recently read a statistic that young people (aged 14-25) are now saving about 28% of their income, and 20% of them, have already started saving for retirement, above their national average of 13.6%.
She also goes on to note that they can save 28% because they’re also living at home, so it helps.
AND WHERE DO WE STAND?
Clearly for Canadians and Americans, we’re not doing as well as we could.
The estimated savings rates for 2013 are actually lower than that.
Canada is set for a savings rate of 4.3%, and the U.S. is set for a savings rate of around 4%.
Australia will also up its game at 12.10%.
In detail, here are the specific numbers:

Data taken from: GFMAG, Business Week
ARE YOU KIDDING ME? LESS THAN 5% IS NOT ENOUGH
If we only save about 4.3%, it is for one thing, not even close to the PF maxim of save at least 10%, and certainly not enough to secure your future.
I like 15% – 25% as a new savings maxim for the future.
Let’s say you make $30,000 a year.
Your net income is $25,942, which is about $2161.83 a month.
4.3% for Canada, is about $92.96 a month.
In 30 years, it’d be $93,379.71.
Now it makes so much more sense why the average retirement savings for a person about to retire is only about $100,000.
Furthermore, with 4.3% as the average, it means that there are people saving less or more than that!
WE AREN’T SAVING ENOUGH!
In contrast, if you saved like other countries mentioned above, it’d look like this with a $30,000 salary per year:

Looks like China, India or Turkey would be my role model if I was earning $30,000 gross a year.
Obviously if you earn more, you could afford to save a bigger percentage of your net income, but you’d have to hit at least the same absolute dollar savings of about $10,000 a year to reach those numbers.
It’s why it’s better to look at your net savings per year rather than as a percentage of things.
You can get lost into thinking that you’re doing well, and you can afford to upgrade your lifestyle when you should really be doing much more.
That’s a rather high percentage of savings however, almost 40% is crazy, especially with the higher cost of living here versus a developing nation.
How do you figure out how much to save without starving?
To do all of the above, you need to know how much you spend on average, and where you can cut back on your spending.
If you have NO IDEA where your money is going, you can’t make any changes.
Track your spending, come up with a budget, and stick to it.
Estimations are for people who don’t have facts.
If I only estimated how much I spend each month rather than really tracking it, I’d be consistently under by a solid 30% – 50%, no doubt, and I would have been hard pressed to remember each category as an average each month.
Plus, I wouldn’t be saving as much as I am today, because I’d be out there wasting my money on crap without knowing where it’s really going. I’d probably be appalled at my spending once faced with the numbers on some debt show that I would eventually end up on.
HOW MUCH DO YOU THINK YOU NEED TO SAVE?
Posted in Money
Also tagged Canada, China, Global, How much do you need, Ideal Budget, India, Money, Retirement, Savings, Savings Rates, Spend less, Spending, Tracking your spending, Turkey, US
31 Comments
Life Changes: I’m not playing around any more
I hinted at this last month, but here’s what’s happening in a nutshell:
- Leaving the United States
Moving to Australia or back toLiving in Canada permanently- Taking a break and going to Hong Kong
Settle in, it’s going to be a long post, and be forewarned it’s mostly a rant about the U.S.
Photograph I took of NYC at 60th St
Leaving the United States
I am leaving the U.S. and I am not going to come back to work any time soon.
Even for vacationing, I am not really sold that this is a country worth touring any longer.
I’ve decided to at least see the Grand Canyon because it’s one of nature’s wonders, but otherwise, the U.S. no longer holds anything special for me.
I originally left Canada for the U.S., thinking the weather would be better (and it is) and it would be more dynamic to work (and it is because of its sheer population), but I encountered the dirty underbelly of America that you can only discover while working there as a non-American.
Bottom line: I’m learning how to cut my losses, so to speak, and choosing to leave.
I could always find another contract or another job here to continue to live and stay, but I simply don’t want to.
I was so gung-ho for this country, and I really thought it would be different, but the bloom is off the rose.
No one could have told me anything to change my mind before I came here. I’m way too stubborn for that, and I had to learn the hard way.
TREATMENT OF IMMIGRANTS: LEGAL OR NOT
Legal or not, you aren’t American… and you are damn well reminded of that when you work for Americans.
They treat illegal immigrants pretty badly, so I was lucky to be on the legal immigrant side.
Everything in the U.S. government and in its structure, is all geared towards Americans (naturally), and I am not blaming them for favouring their own citizens, but I’m learning that Americans say one thing, but mean another.
Everywhere, I hear about how much they need our skills in America, but in the end, they only want us if we’re willing to work under their rules as sub-class residents, which I consider to be a form of economic slavery.
Let’s just say that I didn’t come to the U.S. a free person to willingly put myself into economic chains, so to speak.
Everywhere we went, we saw illegal immigrants, and we couldn’t figure out why a country so tough on immigration (legal or not), would have so many of them clearly without papers.
Then I researched into it a bit more, and realized that illegal immigration and unnamed, faceless workers are what’s keeping the country alive.
The truth of it all, is the whole country seems to survive on some form of slavery, be it actual or economic.
ACTUAL SLAVERY
The actual slavery, is prostitution, abuse of foreign nannies, illegal and legal immigrants working in the fields and locked up at night, picking tomatoes in the fields. It sounds like something out of some Law & Order episode, but it actually exists.
I can’t tell you how many documentaries I saw on TV about all of the above. It’s really disgusting. I’m sure it happens in other countries as well as in Canada, but it seems a lot more rampant here.
……maybe because people also seem a lot less interested in the well-being of others, if they aren’t American.
There seems to be a certain shielded attitude towards non-American citizens, illegal or not.
I absolutely understand that illegal immigrants SHOULDN’T be in the country, but if they are, and have been working and contributing for the past 50 years with nary a peep from either side…. what is the fair thing to do?
I am not claiming to know the answer or the magic solution, but there’s something very strange in the country’s lack of empathy for these situations.
ECONOMIC SLAVERY
The economic slavery, is partly in the form of healthcare that is wholly unaffordable for anyone who isn’t working for a company that offers it.
In a company, you could be looking at about $150 a month, which is $1800 a year, but may or may not include dental or vision benefits.
You could also work for a company who doesn’t offer healthcare, or offers less than what you might expect as basic healthcare.
A freelancer however, pays about $1000/month net for basic healthcare, and for full-service healthcare, it’s $2000/month.
This all works out to at least $12,000 – $24,000 or more, net a year in healthcare costs alone.
NET!
…BUT IT COULD BE MUCH WORSE FOR YOU
If you are an illegal immigrant, forget even thinking about healthcare.
That is the least of your worries.
You don’t even have access to such services because you have to deal with a different kind of economic slavery.
As an illegal immigrant, you directly support and pay into Social Security and Medicare for American citizens, without actually being able to claim that money when you go to retire.
Furthermore, if you’ve ever wondered HOW Americans can produce all-you-can-eat meals for $10 per person and still turn a profit, you should consider that there’s probably an army of illegal immigrants behind the scenes, working for less than $7.25 an hour (minimum wage), making up for the difference.
If you truly wanted to make everyone pay a FAIR working wage, and have FAIR policies towards all people in terms of healthcare and social support, you’d end up with a country like Sweden, where everything is horribly expensive, because that’s the fair price for a just society that provides for each resident and/or citizen.
Photograph I took in Sweden
I remember visiting Stockholm and gasping at their prices, but in contrast, I’d rather live on less in Stockholm in such a society that is fair to everyone, than in the U.S. where everything is cheap, but is built on the enslavement of others.
Slavery is built and fully integrated with supporting to the U.S. system, and it is everywhere if you pay attention and start asking rational questions about how things work.
Everyone is supporting this either directly as business owners, or indirectly as consumers, willingly or unwillingly.
Again… I’m not saying whether this is wrong or right, but for me it’s part of the reason why I’m not staying here.
Interestingly enough, Bob Dylan just made a statement recently about how the slavery stigma has ruined America.
The veteran musician tells Rolling Stone that in America “people (are) at each other’s throats just because they are of a different color,” adding that “it will hold any nation back.”
…he doubts the country can get rid of the shame because it was “founded on the backs of slaves.”
He also says blacks know that some whites “didn’t want to give up slavery.”
Well Bob, I’m of the belief slavery is still alive and well, just in a different, more subtle but malicious form.
U.S. POLITICS AND THEIR GOVERNMENT
Okay, so I never realized this until living in the U.S., but Canada is pretty reasonable. Boring, but reasonable and stable as a country.
Only in the U.S., you have people in government like Todd Akin saying things like “legitimate rape” on TV, and people are actually publicly supporting his lunacy, or more ridiculousness like Rush Limbaugh calling Sandra Fluke (a student who asked about birth control), a ‘slut’ — he didn’t just do this offhandedly, he purposefully, deliberately, spent 3 hours a day on his show for a WEEK, calling her a prostitute.
It’s like saying the following:
What I think everyone may be forgetting, is that women are 50% of the population, and young women in particular are increasingly starting to earn more than their male counterparts.
Essentially, for some Americans there is such a thing as good, acceptable rape versus bad, wrong rape… and that women who are responsible, and take birth control and expect such medical coverage from their employers (such as myself), are sluts.
I can’t imagine any of those words and thoughts even being blurted out of anyone’s mouth in Canada on any public forum and surviving.
I remember Kim Campbell back in the day, vying to be Prime Minister, making fun of Jean Chretien’s partial facial paralysis. Her career was instantly over without a whimper with such a fierce public lash back to her appalling ad, and Chretien was the clear winner.
Aside from all this lunacy, you also have these parties on both sides spending millions of dollars (and corporations supporting them too), in campaigning to become the President of the U.S.
Why don’t you take that money and take care of the residents of the U.S.?
Did you know there are 16 million kids who are starving in the U.S.?
Why are they talking about helping the rest of the world, when they can’t even take care of their own?
It’s all so ridiculous, it can only happen in the U.S.
(I am not saying the Democrats are 100% amazing either and I don’t necessarily agree with or support everything they do, but all the stupid comments can’t seem to stop flying out of Republican mouths.)
AMERICANS MAKE MONEY, BUT LIVE LOW QUALITY LIVES
Lastly, there are plenty of articles (I even heard it a number of times during political debates) on how there is a lot of money to be made in the U.S., but they just fail on meeting the basics of a good, solid society because there’s just too much money.
They make lots of money as individuals, but they aren’t happy because the income disparity between citizens is too high, so it becomes a low quality, and POOR life for many.
Not to mention that they basically eat junk food and call it a meal.
I know this isn’t 100% of Americans, but let’s face it.. they’re the fattest nation in the world for a reason, and it DIRECTLY affects their healthcare costs because they have to pop pills on a daily basis to stave off disease and delay death caused by their own lack of proper nutrition and eating habits.
Chips, greasy hamburgers, mystery meat hotdogs and anything void of a vegetable or fruit resembling its former shape and glory, is not a meal that you can eat on a daily basis.
Junk food and eating out is fine, but not 100% of the time.
Drinking soda and other sugary fruit juices is fine, but not 100% of the time.
It’s like there’s an allergy to eating real, natural food in the U.S.
Everything has to be transformed, covered in oil, some sort of fat, or super salty and/or sugary.
That is.. unless you’re willing to fork over $$$$$$$$ to go to really nice restaurants or buy organic, wholesome foods; but I’m willing to bet that the majority of America can’t afford that, nor can they understand why they’d eat a celery stick instead of a potato chip.
It was kind of sad really.
One of the richest countries in the world, has most of its people eating junk, rather than real food.
NO REGRETS, EXCEPT FOR THE SHOPPING
It isn’t as awesome as I remember it being or imagining it to be.
Only the shopping is amazing here.
Let it be said, that the United States is the #1 country in the world for shopping, both online and in-store because of their free shipping and free returns.
(Although I would rule out all U.S. pharmacies and eyeglass stores in this assessment, as I find they are FAR BETTER in Canada in terms of variety and stock. Go Shoppers!)
That’s it.
Otherwise, I don’t regret anything — the move, the living here, the whole change in my life.
I HAD to come here and be in the thick of things to realize all of these things. I’m just happy it didn’t take me 10 years before I realized all of this.
I’m also very lucky that I’m able to leave, unlike many who live in this country and don’t have a better country to go back to.
You have no idea how grateful I am to my parents not having moved to the U.S. instead.
Moving to Australia or staying in Canada?
So.. my next step?
I left Canada, mainly because 6 months out of the year, it’s too cold to do anything.
I know it sounds trivial to leave a country that is otherwise fine to work in just because of the weather, but this is not the way I want to live, hiding out in my apartment, whining about how cold it is.
I’m lucky enough to have a job where I can basically work anywhere I want in the world, so I want to make sure I make the best choice for myself before I commit.
I thought long and hard about going to Australia.
I’ve even spent $1000 $600 in the process of doing it, but I’m pulling the plug on the whole thing.
I’ve been thinking about it for the past 2 weeks, and I’m staying in Canada.
For good this time.
It’s really one of the best countries in the world, aside from the weather, and I’ll just have to STFU, and learn how to live through 6 months of a nasty winter without whining.
I’ll just travel a lot.
Traveling for the year in the meantime
My map of Macau when I visited
So… I really want to go on one vacation. I’m really exhausted mentally, emotionally and physically.
I am going to Hong Kong for a month, getting everything set up and ready.
Then I’m going to go full speed ahead in 2013 for working in Canada. Savings and higher net worth, here I come!
The Poor versus The Rich: Spending Habits
Poor versus the Middle Class and the Rich infographic.
It goes without saying that 5% of a budget varies greatly, so here are some numbers to keep in mind:
- 5% of $150,000 = $7500
- 5% of $70,000 = $3500
- 5% of $20,000 = $1000
The percentages spent from their budget look fairly similar, until you get to these two categories:
- Saving for Retirement at 15.9% for the Rich versus 2.6% for the Poor
- Education at 4.4% for the Rich versus 1.5% for the Poor
These amounts are also by YEAR, not month.
Infographic credit: FastCoDesign who also writes a great commentary on the above.
Link originally obtained via @eemusings who writes at Musings of an Abstract Aucklander
It is also no surprise to me that the Poor spend the most amount of money on Food At Home, and the Rich spend the least (although the Rich’s “least” spent is $8100/year or $675/month).
Although I daresay it isn’t such a bad thing for the Poor to eat at home, they are most certainly not able to spend their meager grocery budget on organic, fresh foods, which I suspect is where the difference is in those food budgets between the Poor and the Rich.
Everything just costs so much more for the Poor in terms of how much it eats up of their budget just to cover the basics.
Where can you really afford to cut in such a budget?!
(And I used the highest income for the Poor at $20,000 versus $15,000!)
HOW MUCH THEY SPEND AS A DOLLAR AMOUNT
The totals don’t add up to 100%, but the authors noted that there were discrepancies.
Now for some analysis!
TOP 3 CATEGORIES WHERE THEY SPEND THEIR MONEY
Housing and Transportation and Gas are the two most common categories.
The poor have to prioritize utilities over other parts of the budget, but the Middle Class and Rich save quite a bit for retirement in comparison.
WHAT IT LOOKS LIKE AS THEIR MONTHLY BUDGET
The amounts are easier to understand when they’re broken down by month.
The Rich put approximately $1350/month of food into their mouths each month, which is almost the entire monthly budget of the Poor.
For the Rich, they are spending almost 12X more on average versus the Poor (multiplier ranges from 4X to 45.8X more).
The biggest multiplier is the Retirement for the Poor at $43.33 dollars a month versus the Rich at $1987.50 a month which means they are saving 45.8X more a month.
THE BUDGET IS REALLY TIGHT
Naturally, we feel the urge to judge them and say: Well, just take the $78.33 they spend in Food on Restaurants and put some more into Food at Home, and the rest into Retirement!
I’d agree with this, but would you, if you were in that position really have that kind of foresight to do that?
1) I am fairly sure they aren’t crunching those numbers like us personal finance geeks.
2) They just want to have a break and a treat once in a while like anyone else, except they don’t realize that they can’t afford it.
3) Maybe they’ve just given up and resigned themselves to their situation, and just do the best they can while still living
It’s very easy to say what you would do, but it’s a lot harder to execute on such a tight budget.
Let’s just take a quick peek at this PDF I found via the National Low Income Housing Coalition: Hours at minimum wage needed to afford rent
Even looking at those numbers, they seem low. Minimum wage is around $7.25/hour if I am not mistaken.
So even in the cheapest of all states:
$7.25 x 70 hours = $507.50
These people obviously NEED to share housing with a roommate or 7 to be able to have shelter unless they’re living in the middle of nowhere, which means their Gas/Transportation costs will go up accordingly.
….and the IRS really thinks that people can live on $534 a month on a budget without Housing factored in!?!?
Even if you remove all the borderline-luxurious categories like Food At Restaurants or Entertainment, just the Transportation and Utilities alone ($525) will almost eat the entire IRS-proposed budget.
So what about Healthcare? What about Education? They still need a minimal budget for Clothes too!
THE NUMBERS ARE MOTIVATING ME
As this blog is clearly all about ME
— I am rather pleased with my numbers against the Rich category.
- Housing: I try to spend around $1500 a month on average versus $3437.50
- Transportation: I spend about $500 maximum in this category versus $1937.50*
- Retirement: I try and save double the average — $1987.50
*This would change if I had a car, which I am not opposed to buying. I just haven’t seen a need for one yet and Public Transportation is so much cheaper when you think about Insurance, Parking, yadda yadda.
These numbers motivate me and make me think more about my own spending and especially my saving.
In the past few years, my net $ savings (not my net worth) have been:
- 2008: $60,000 <— Estimated. I lost my 2008 worksheet
; Cleared $60K debt - 2009: $8936.18 <— Didn’t work much; Recession woes
- 2010: $130,100 <— Landed a few contracts
- 2011: $0 <– Net worth dropped because I traveled for a year & made $0
- 2012: $17,500 (Estimate) <– I am hoping so hard for this!
Average = $43,407.23 a year in net savings
I could certainly save more especially at my income level, I’m sure.
Actually, I could just stand to work more, but I think traveling (on a fairly cheap budget) is something that should be done when you’re young, especially given that I can afford it and I want to do it, knowing the consequences.
What do you think about the numbers above? Do they motivate you? Discourage you? Any other observations?
Posted in Money
Also tagged America, Budget Roundups, Household, Income, IRS, Low Income, Middle Class, Minimum Wage, Money, Poor, Rich, Spending Habits, Where does all the money go
12 Comments
Americans earn about $50,000 a year
Median. Not on average.
Via Planet Money
Note on Income and Benefits:
The income part of the data excludes dividends, capital gains and income from real estate, like rent payments.
The benefits part includes food stamps or subsidized housing. Many of these government subsidies are targeted at poorer households.
THE TOP 5 HIGHEST SALARIES BY STATE
- Maryland: $68, 854
- New Jersey: $67,681
- Alaska: $64,576
- Connecticut: $64,032
- Hawaii: $63,030
THE BOTTOM 5 LOWEST SALARIES BY STATE
- Mississippi: $36,851
- West Virginia: $38,218
- Arkansas: $38,307
- Kentucky: $40,062
- Alabama: $40,474
But really. All that glitters is not gold.
Not everyone who earns a big salary, looks like they earn a big salary.
“….a small but highly compensated blue collar occupational group, materials handlers, that is often misjudged and overlooked by marketers of a variety of affluent products and services. ” ( Read more )
What do Americans buy and where does the money go?
Fantastic post over at NPR about where Americans spend their money.
They took all the data and created these two crystal clear graphs:
WHAT AMERICANS SPEND THEIR MONEY ON (2011)
- Shelter is the biggest at 31.5%
- Women’s clothes are double the spending of Men’s clothes
AMERICAN SPENDING FROM 1949 to 2011
- Food has shrunk in terms of cost because of advances in agriculture — I am still not sold on it being a good thing to have so much food for such cheap prices, as today’s milk doesn’t taste like real milk to me, and only heirloom tomatoes taste like real tomatoes
- Apparel has also gone down in cost because of dirt cheap labour being outsourced overseas — also not sold on this being a good thing
- Housing has jumped quite a bit, taking up a lot more income but houses have also doubled in size from 1000 square feet to 2000 square feet or more (McMansions anyone?)
What do you think about all these numbers?
Posted in Money
Also tagged American Spending, Budget Roundups, Finances, Household, Money, Trends
1 Comment





















