60/40 Split

While casually browsing through my reader the other day I saw a post  from Valerie over at "Beauty and the Budget" called "Save More with this Quick and Easy Budget Tip". Of course I was intrigued. Turns out the "quick and easy" money tip is the 60% method conceptualized by this guy. Basically, the goal of the 60% method is to limit your monthly expenses (i.e. mortgage/rent, utilities, gas, food, etc) to 60% of your income and use the other 40% in various ways to contribute to retirement, long-term, or short-term savings or even pay off debt. It's intent is to help you save more money faster. Theoretically who would be opposed to saving more money (or in my case, paying off credit card debt) faster. No one. The real question becomes  who is living within 60% of their income? Anyone? Bueller?

Exactly.

I took a minute to add up our monthly expenses (including the obscure ones we don't actually pay monthly like car insurance,  the water bill, and county city taxes) and found that 76% of our income each month was going towards "fixed" expenses not including my credit card payments, clothing, or Chick-fil-a  dinner out. ("Fun" expenses are meant to come out of the 40%, not the 60%). SSF and I do not exactly live a lavish lifestyle, but if 60% is considered ideal, then we are clearly living outside of our means.

So what now? Is 60% possible? I'm sure it is, but it will take some work, and most likely extra income (or an increase is salary) to achieve. I would imagine paying off both of our cars would be involved in the process.

Do you think that the 60% methood is a viable tool? What % of your income are your monthly expenses?

[image: here]