Zero’s Mathematics


Everyone has their own specific way of tracking goals, quantifying their savings rate, and deciding what “success” means to them. They are pursing many different courses in attempts to reach their dreams.

I don’t do anything special, but over the past few years, and especially in the past year, I’ve found methods and systems that work for me.

I’m also here to define what I mean by “savings rate” and such that are left ambiguous most of the time. When I read blog posts about savings rates, sometimes it’s hard to assess if a blogger’s savings rate uses the same equation that I might be using. Is it pre-tax? Post-tax? Does it include 401K? Or just cash? I want to make my mathematics clear.

Since if I’m going to start an anonymous blog, I might as well go full-out with transparency, I am sharing “my” definitions of concepts I discuss a lot in my posts.

50% Savings Rate

When I say I have 50% savings rate (down from around 60% in 2018), I am saving 50% of my take home pay. Which is to say, one paycheck every month goes directly into my savings account via automatic transfer.

For some people, the savings rate includes 401K, or it’s pre-tax (I don’t know how people manage this one!). Since I like being able to control how much I spend and save in a reasonable way, I decided to do take home.

Gross Pay
I take home 48.58% of my paycheck.

If I calculated my savings rate based on my gross income, I would be saving 54% of my gross income counting my HSA, or 50% without my HSA. This number includes cash I save and 401k.

Actually, I just did this calculation for the first time, and I’m surprised that despite taxes and benefits and such, I am technically saving 50% of my gross annual income!

I don’t count my HSA contributions (I max it out every year) as part of my savings rate, because I actively use my fund for medical costs. As of January, I’ve already spent 100% of my deductible on hospital visits.

But for my case, I am only counting how much I save out of my take home pay (48.58% of my paycheck) when I say I have a 50% savings rate.

Annual Savings Goal

My Annual Savings Goal consists of my cash savings from my take home, 401K contributions, and income from my side hustles.

My 2019 Savings Goal is $40,000. The breakdown is:

  • Cash Savings: $1,500 x 12 = $18,000 (one paycheck from take home)
  • 401K: $19,000
  • Side Hustle: $3,000

As of mid-February, my Freelance Side Hustle income has been almost $4,000, so I am anticipating being able to save a lot more. I have to contend with freelance taxes for the first time this year though, so I’m going to monitor to see what happens.

I don’t count my company’s contributions to my 401K as part of my savings because I’m not doing anything to “save” it. But I do include it as part of my Net Worth.

I’m considering opening an i401K to pull down my tax burdens a little bit, but we’ll see if I can whip up the courage! If any of you have recently done it, or have a great resources on opening an i401K and methods for not getting in trouble with the IRS by over-funding, etc., please leave me links in the comments! I’m sure I’m being over-nervous about this (like I was when I opened a Roth IRA), but I would rather be a little nervous than be booped by the IRS come next April!

Net Worth

Everyone calculates their Net Worth differently. Some people include the whole value of their house, even if they have mortgage. Some people only include the amount paid off on the house. Some people consider cars to be assets, others consider them to be depreciating assets that don’t belong in their Net Worth calculations. I’ve seen some people even including their laptops or DSLRs in their Net Worths.

My “Net Worth” includes my cash assets (in checking and savings accounts), investments (in Robinhood and Vanguard), and my retirement accounts (in Roth IRA and 401K).

So my monthly calculation of Net Worth includes all of the above components. I still have portions of my 401K that are not fully vested (they will vest 100% come December), but I count it towards my Net Worth. At this point, even if it doesn’t fully vest when I leave, it would only change my numbers by a few thousands at most.

I don’t own a car or a house, and don’t have any other assets. If I have access to the internet, I have access to all of my assets.

This actually provides me with a lot of freedom because I am not tied down to any location or status quo. I feel free to just pick up and go if the need arises, because I have nothing to sell except furniture.

Side Hustles

I consider everything I do that pays money that is not part of my full-time job a Side Hustle. I have quite a few of them. In the past, they have been tutoring, babysitting, tech support, web designer,

Currently, I do video course development, writing, dog sitting, and periodically babysitting (I’d rather not, but sometimes old clients call me up for help). I also publish eBooks where I have been able to earn around $100 a month in Passive Income. I also sometimes do User Interviews, which pays me in everything from a $30 Amazon Gift Card to a $250 check.

I am keen to up my Passive Income game in 2019, as it means I don’t have to actively do things to earn money. Some threads I have going are high interest savings accounts, eBook sales, and in a few months, video courses.

Other sources are cash back platforms like EbatesMr.Rebates, and Yelp CashBack. I also have an Amazon Affiliate account, but that rarely amounts to much.

I have also been selling some resources on Teachers Pay Teachers since 2013 that I completely ignore until I get random Paypal deposits from them. If you are a crafty teacher or any professional related to education, I highly recommend TpT as a place to sell your eResources, because there is a HUGE market. On the flip side, if you are in need of resources, TpT is a great way to support fellow educators with their Side Hustles!

The above few sources are bonuses, where I might get a surprise $10, $15, or $30 every 3-6 months, but it’s nothing that I can rely on as a source of income.


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  1. Allinmyworld (@_allinmyworld)

    i wish I could be making this much from side hustles especially ones where I don’t have to be physically demanding right now I work full time and I also do Grub hub food delivery and on the rare occasion uber eats or regular uber but it doesnt pay as well. I think I average about $1000 plus with grub hub depends how much I feel like working. Some months I work a lot other months after my regular job I don’t want to do much of anything I get tired. Look forward to reading more of your journey and blog!

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