The less you pay in taxes each year, the higher your savings rate. This means taking maximal advantage of all your available deductions. Deductions such as mortgage interest and property taxes are the biggest ones if you own a place. However, regardless of whether you rent or own your place, maxing out your 401(k) account every single year is absolutely essential. Not only does the 401(k) force you to save + invest a minimum amount each year, it also chops off all federal and state taxes on that $18k at the marginal (highest) rate. These savings can add up pretty quickly over the years.
Oftentimes, maxing out your 401(k) every single year for both you and your spouse is the only ultimate frugal hack you need to do. The earlier you start (start in your 20s), the more powerful your 401(k).
After you’ve maxed out your 401(k), time to put in another $5.5k into your Traditional/Roth IRA (if you qualify), and then another $3.4k into your HSA (if you have one). Finally, if you have known health care expenses, put additional money into your tax-free FSA, and keep your HSA untouched for retirement. Finally, be sure to pay your commute expenses (train/bus/parking) via tax-free deductions. If you bike to work, most decent-sized companies give you $20/mo for free to use towards almost any bike-related expense.
Thinking about getting married? If both members are high income earners and without kids (I call these people DINKS: double income, no kids), it might probably be a bad idea financially, at least here in the United States. However, if your partner earns significantly less than you or close to nothing, you can “transfer” some of your income to your low-income-earning partner thereby reducing your combined tax burden. If you’re already living with someone like that and don’t mind sealing the deal, getting married might be a good strategy money-wise. Likewise, if you’re already married to someone and both of you are high income earners, a paper divorce might not be the worst of ideas from a purely tax perspective. From a social perspective, your mileage might vary, but nobody has to know about your legal married status, do they?
The Traditional IRA deduction limit also favors unmarried individuals over a married couple with double income. In 2017 for instance, you get phased out of IRA deductions at $72k individually ($144k combined), but as a married couple, you get phased out sooner at $119k combined, a whole $25k earlier.
Disclaimer: This is not official tax or legal advice so run your own numbers or consult someone professional before making actual decisions.
Potential savings: $450-$650 every single month.