23 in 2023 Challenge: Save 23% of your income in 2023

2023 is almost here and it’s sure to be a banger just like the past three years.

We are continuing the 22 in 2022 challenges but have slightly adjusted the goal post for a new year - by 1%!

It’s simple but not easy: save 23% of your income in 2023!

:memo: **If saving 23% of your income is easy for you (or if your income is over 100K) - please use the alternative 23 in 2023 Challenge: Save $20,230 of your income in 2023 Both get the same sticker, but the threads will have people at similar income/challenge levels.

Basic rules:

  • The goal is to save 23% of your pre-tax income in 2023. If you make $40,000 per year, that’s $9,200 or $766 per month.
  • You can combine any type of savings: emergency fund, 401K, Super, IRA, ISA, taxable investments, buffer, house down payment fund, student loan payments - to reach your goal.
  • You can choose household or individual salary, whichever you prefer.

What Counts

  • Debt repayment counts towards your savings rate!
  • Mortgage principal (but not interest or escrow) counts.
  • Only savings that occurs between 1/1/2022 and 12/31/2022 count.
  • You can use tax refund or any other windfall money towards your savings percentage, but you then must count that windfall towards your overall income.
  • You can choose to count your income and savings jointly with a partner or separately - up to you!
  • biden student loan forgiveness counts but only if you also count it in your gross income.

What do you get:

  • Support on this thread as you go along - post monthly or quarterly check-ins as appropriate
  • A forum badge when you complete your 23% goal for the year
  • A sticker mailed to you for the 23% goal for the year
  • A shoutout on the livestream for reaching your goal

Here’s 2021 and 2022’s slightly unhinged stickers:

Please Tag @anomalily when you hit any goals so we can get you your badge!

Here’s all the 23 in 2023 Challenges:

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I AM IN FOR THIS ONE! I hope I can do $20,230 challenge but as that is about as much as I took home in 2022…we’re gonna go for this one.

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I’m definitely in for this one. I am hopeful to switch to the $20,230 later in the year once I see how sales go. My base pay is like $32,000 so I need good commission checks to really save much.

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I’m in for this one! It’s going to be much tighter than normal since I want to do so many house things.

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I’m in again - it’s also going to be much harder for me because I am reducing hours worked (hopefully) and will need to do some house work, and I don’t know how much that will cost. If I only save bare bones (10% 401(k)), $6,500 to IRA, and mortgage principal (no extra), and I make the same as I did in 2021 (which was less than this year), I will be at ~21%. My plan for this year is to roll more $ into CDs since rates are good now, better than simple savings (though also quite good) and guaranteed, but I don’t know if I will include that. I would like to keep them going year after year (if rates are good enough), but it entirely depends on the markets. I had planned to do a CD ladder when I quit the last time (2019) but rates were so abysmal that I did not.

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I want to do this one but it always gets a bit complicated between my two jobs and multiple savings accounts and I always lose track partway through the year, lol. Gonna try hard though because there are definitely some savings goals I really want to reach/some sinking funds I want to get and keep stocked!

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I’m in! I’ve never actually calculated our savings rate so this will be a great exercise. I’m not sure whether this one or the raw dollar amount is a better fit for us- I’ll have to crunch some numbers!

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I have a spreadsheet I use for multiple accounts that I can share that might help!

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That would definitely be helpful to look at! One issue is that for my hourly job I have it set to direct deposit a small percentage into two different savings accounts with each paycheck so I at least save a small baseline amount. But then I usually transfer more in whenever I have extra, sometimes multiple times a month so it doesn’t look like I have money to burn in my checking account. It’s not an insurmountable problem, but it makes things more tedious for tracking these kinds of things. On the other hand, it has been really effective in getting me to save quite a lot, which is the most important thing ultimately!

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I’m back and ready to party! Probably won’t be able to swing the $20,230 this year, but I’ll still track for both. Income includes salary, retirement match, and other (gifts, expense reimbursements, tax refunds), and savings includes cash savings, IRA, and 403b. Wrinkles this year may include job continuity and/or a mortgage.

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I’m in for this year! I’m doing some travelling this summer that might make this difficult, but one of my goals for the new year is to save more. We’ll see how this goes and if I need to duck into the 23 a week/month challenge instead.

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I’m in for this challenge!

I still have to crunch a few numbers so I’ll post those later this week. generally I’m aiming for $12,000, which is a little over 23% but will also be a good stretch for me.

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Question! I am looking at my first paystub of the year to track my gross income and my savings that come out of my paycheck (457(b), HSA).

I have a defined benefit deferred compensation plan (local government pension). About 10% of my paycheck goes to that, but I have no control over it and don’t 100% trust it.

My instinct is NOT to count that money as “saved.” Do y’all agree? I realize this is a personal challenge and it’s really up to me, just interested in perspectives!

I am in. Thanks for those challenges @anomalily. A lot of incertainty for me this year but I want to continue saving some of my income so I’ll try this one maybe switch to the 20,230 if things settle better around mid-year. It is an excuse to build a new spreadsheet. I will save in EUR and it will be individual income and savings.

I didn’t follow up since 2020, how often do people report on their goal? Monthly or just when they achieve it?

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Some people do monthly, some people do it less frequently.

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If you decide not to count it as saved, you could also deduct it from your income (since you don’t actually get it and can’t otherwise spend it). Then you are going for saving 23% of a lower base.

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I’m in!

23% is about 15k.

The goal is to pay off 8k of debt, then save up as much as possible for midyear medical costs, and then if those aren’t covered by what we saved, save more via paying off medical debt. If we get through all that then we can try and save for real.

This could be difficult but I think it’s mostly a matter of not spending all our money on takeout…

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That’s really helpful, thanks! I might run two separate columns and compare them. I didn’t even think of deducting it from the gross but of course I should.

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Looking at my paycheck as it’s currently set up, if you DO include my pension contributions, I’m saving over 27%. That includes HSA savings because I don’t generally spend those. If you don’t include the pension, I’m at 20%. I have not yet looked at the Boy’s pay stub to see where he’s at.

Sorry if this has been answered elsewhere or is obvious: how do we count employer contributions to a retirement plan? Would it count toward both income and savings? In my case it’s a 3% contribution match that gets dumped into my IRA in an annual lump.

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