Living on One Salary

As this period of receiving two salaries comes to a close, I'm reviewing how our saving vs. spending has been during the last year. Current savings shows savings from non-investment income into non-retirement accounts ("taxable accounts" in American jargon - I don't use the term because retirement accounts are taxable in Australia, just at a lower rate). Since I started getting a salary in March 2009 we have managed to save almost $A50,000 (see the blue line). That's more than I earned in fact. In the period from late 2007 till then when we were living together on one salary, savings was pretty much flat - in other words, we didn't save or dissave. In the last year we managed to save at about the same rate as or a bit higher than I did when I was single and living in the US from 2002 to 2007. Our retirement savings (pink line) accumulated rapidly - at about the rate I managed in the US when earning extra summer pay or when I started maxing out my 403b in 2007 (which brought my non-retirement savings rate down to almost zero).

This shows that we basically live on one salary whether we are earning one or two salaries. But in order to save we need two salaries.

The green and brown lines show that there has been some regain of investment losses. But there is still a long way to go till the losses are entirely recovered.