$40-80K: 1% of total income (including the first $40K)
$80-$200K: 1% of first $80K, then 5% of remainder up to $200K
$200-320K: $9,760 (as calculated above) then 10% of remainder up to $320K
$320-$480K: $21,670 (as calculated above) then 15% of remainder up to $500K
$480K-$?: $45,760 (as calculated above) then 20% of remainder
[didn’t input higher numbers, except that inputting a gazillion spits back a 50% recommendation]
[This crosses 10% just above $500K]
My initial reaction was that one could make a smoother curve for the marginal contribution rate. But playing with the numbers, the rise in total percentage recommended looks fairly smooth and continuous (albeit less so around the $80K boundary). So maybe the increase in legibility for a bracketed system outweighs a theoretically smoother formula. But I’d at least consider something like a 3% bracket from ~$60-$100K if I were reworking this (without a desire to change overall recommendations very much).
The website links to the FAQ for info about the calculation method, but I didn’t see the info there.
The 10th ed. was copyrighted in 2019, and US wage levels rose about 18% from 2019 to 2022 alone. So these cutoffs were even less demanding in 2019 than they are today; the 81K cutoff for asking more than 1.00% might be close to 100K in mid-2024 wages.
Incidentally, the formula seems to be:
first $40K: undefined
$40-80K: 1% of total income (including the first $40K)
$80-$200K: 1% of first $80K, then 5% of remainder up to $200K
$200-320K: $9,760 (as calculated above) then 10% of remainder up to $320K
$320-$480K: $21,670 (as calculated above) then 15% of remainder up to $500K
$480K-$?: $45,760 (as calculated above) then 20% of remainder
[didn’t input higher numbers, except that inputting a gazillion spits back a 50% recommendation]
[This crosses 10% just above $500K]
My initial reaction was that one could make a smoother curve for the marginal contribution rate. But playing with the numbers, the rise in total percentage recommended looks fairly smooth and continuous (albeit less so around the $80K boundary). So maybe the increase in legibility for a bracketed system outweighs a theoretically smoother formula. But I’d at least consider something like a 3% bracket from ~$60-$100K if I were reworking this (without a desire to change overall recommendations very much).
I believe the values come from the 10th anniversary edition of the TLYCS book. They should be in the FAQ on the website and I’m surprised they’re not.
The website links to the FAQ for info about the calculation method, but I didn’t see the info there.
The 10th ed. was copyrighted in 2019, and US wage levels rose about 18% from 2019 to 2022 alone. So these cutoffs were even less demanding in 2019 than they are today; the 81K cutoff for asking more than 1.00% might be close to 100K in mid-2024 wages.
Thanks for the valuable context, Jason and MHR!