Definition
Savings Rate
The percentage of your income you keep instead of spend.
This term appears in The Budget Ledger's practical finance glossary.
Your savings rate is the share of your take-home pay that goes to savings and investments rather than spending. Saving $600 out of $3,000 a month is a 20 percent savings rate.
It is one of the best predictors of long-term financial progress, more than income alone. A high earner with a low savings rate just has expensive spending; a modest earner with a high savings rate quietly builds wealth.