The 1% Rule: Increase Savings with Every Raise

The Problem

Lifestyle inflation eats every raise. You earn more but save the same amount year after year.

The Hack

When you get a raise, increase your automatic savings transfer by 1% of your salary. If you save 10% now and get a 3% raise, go to 11% savings. You still take home more.

Why It Works

You never adapted to the raise money, so you can't miss what you redirect. Over 10 years of normal raises, this turns a 10% savings rate into 20% without any sacrifice.

Pro Tips

• You still get a raise — just slightly smaller
• Going from 10% to 11% savings on a $50K salary is only $42/month
• Over a career, this single habit can add $200K+ to retirement
• Also works with bonuses — save at least half of any bonus