Setting Saddle Height...

There's a lot of mis-information/mis-understandings regarding saddle height. The simple fact is, your saddle height should be set according to how you pedal, and NOT whether you can touch the floor whilst seated.

When you come to a stop, you should ALWAYS take your bum out of the saddle and place at least one foot flat on the floor (that's if you don't want to fall over sideways at least).

So, how do you set your saddle height? It's simple.

1) Find a nice quiet road with a kerb and place the bike in the road (preferably while there are no cars coming). This lets you sit in the saddle, but keep one foot on the floor.

2) Adjust your saddle so it looks "about right". Everyone is different so there's not a simple way to get this right first time. Tighten it up about 60% (chances are you'll need to adjust it a few times).

3) Sit on the saddle with one leg in the pedals, and one leg standing on the pavement. Adjust your saddle so your leg is about 80% straight while the pedal is pointing to 6 o'clock.

Your leg should NOT be straight as that will lead to strain/injury, but you don't want to be wasting your pedal power by having it set too low. 

Once you think you've got the height about right, tighten up the saddle bolt and go for a quick spin. It might feel a bit strange if you've had your saddle too low, but it's much more efficient and actually safer. You won't tip over when coming to a stop because you always have one foot firmly on the floor.