Homebuyer Resources

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Saving for a Home  |  Budget Plans

The 60% Plan
Traditional Plans

The 60% Plan

• Keep your committed expenses at or below 60% of your gross income

  Basic food and clothing needs
  Essential household expenses
  Insurance premiums
  All bills

• Automatically deduct 10% of your monthly income to a retirement savings account

• Automatically deduct 10% of your monthly income to a long–term savings account

  These savings can be used for your down payment and closing costs
  Do not link this account to your ATM card
  Use a second bank if necessary

• Automatically deduct 10% of your monthly income to a short–term savings account

  Money in this account can be easily transferred to your checking account or ATM card
  Use these savings to pay for vacations, repairs, new appliances, holiday gifts, other irregular expenses

• Set aside 10% of your monthly income for Fun Money

  Spend this on whatever you like, but make sure it doesn't exceed 10% of your income!

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The Traditional Budget Plan

1. Identify how you spend money now

   a.  Track your spending habits for a few months
   b.  Categorize your expenses

2. Evaluate your current spending and set goals that take your financial objective into account

3. Track your spending to make sure it stays within your guidelines

Tips:

• Use financial software or online tools to save grief

• Don't drive yourself nuts accounting for every single penny, but watch out for cash leakage (ATM withdrawals are the biggest offenders!)

  Monitor your ATM withdrawals — decide how much you will take out each week and make it last

• Beware of luxuries dressed up as necessities

• Set up an automatic investment/savings plan. Money automatically deducted from your pay can make it easier for you to live without it.

HomeStreet offers many different banking services