For most primary-residence purchases you will not need reserves at all, and when retirement accounts do count, only part of the balance does. On a 1-2 unit home you will live in, FHA requires no reserves with an AUS approval (one month if manually underwritten), VA and USDA require none, and conventional reserves are set by the automated underwriting system, often zero but not guaranteed zero. The exception by rule is a 3-4 unit primary residence: FHA requires three months of the full housing payment in reserves and VA requires six. When retirement assets are counted, lenders discount them rather than taking the full balance: - 401k and IRA balances get a haircut. Fannie Mae's guideline counts 60 percent of the vested balance toward reserves, to account for withdrawal penalties and taxes. FHA and VA apply similar vested-balance discounting. - Loans against the account subtract. An outstanding 401k loan reduces the balance that counts. - Locked funds count for nothing. Money you can only access at termination, retirement, or death cannot be counted, so you have to document that the funds are actually reachable. - HSAs are shakier. Those funds are earmarked for qualified medical expenses, and whether they can count depends on the plan and the program. We would not build a plan around them. So the percentage varies by account type and loan program, and for most first-time buyers on a primary residence, reserves never come up at all. Do not assume you have to drain retirement accounts to qualify. Your lender can tell you exactly how much of each account applies to your file.