In this economy it is becoming increasingly hard to afford even the down payment for your dream home let alone the rest of it. Even if it may seem impossible at times, there are ways you could achieve that with a well laid-out plan of action and a few smart strategies.
Before you begin you would need to be clear about how much you will need to save up so that you can allocate your time and resources efficiently to achieve it. Depending on the size of the house and what you are looking for, the amount would be different, but it is normally around 5%-10%. Saving up more is usually believed to give you better mortgage rates later so if you think your strategy is working, why not carry on and make your life a bit easier later?
Now that you have established that, the work begins. Here at House Sales Direct, we have compiled some of the smartest and most efficient tips to save for your first dream house without having to sacrifice too much.
Tip 1: Build a Budget
Budgeting is essentially the most important step in the process of saving up. Unless you know where all your money goes into each month, there’s no way you can know where you can cut costs. Figuring out how much you spend on rent, food, bills, entertainment and other necessities is important for analyzing which part of your daily life you can make changes to. Once you have done that, you should be able to create a budget for each category and a strict saving plan which is not only going to bring you the money you need but it’s important that the budget is realistic and doable as well. You don’t want to lose motivation halfway through so making a plan that you know you can stick to is key.
Tip 2: Set a Timeline
Once you have finalised your saving goal and areas where you might be able to cut down on expenses, you can also set a timeframe for achieving this. Doing this will help you create your budgeting better and let you set realistic smaller goals along the way. What’s more, estimating how long it would take you to reach the amount you need for the deposit is a step you can’t miss.
Tip 3: Reduce Daily Spending
When it comes to daily spending, think about all those overpriced iced lattes you purchase weekly, or meal deals you get for lunch. Even though it may seem like an insignificant amount of money, when you add it all up, it can make a difference in the long run. If you tend to go out to restaurants instead of cooking at home, that’s one place where you could cut costs significantly. You shouldn’t necessarily stop doing anything you enjoy, reducing the number of times you do it will still give great results.
Tip 4: Unsubscribe From Unnecessary Services
We live in a world of many, many subscriptions and even some which people often forget to unsubscribe from so it’s important that you check yours and sort them out. Analyse which ones are the most important for you and cancel the ones which are in excess. For example, if you have both Amazon Prime and Netflix, it might be worth choosing only one and canceling the other one.
Tip 5: Make Extra Money
If it feels like you can’t cut your expenses much or that it will take forever to save up for the deposit, then you might need to think about finding an extra income source. There are plenty of ways you can boost your savings with some additional work over the weekends or a side hustle. Starting your small business on Etsy, selling some old or unnecessary items you have laying around your house or doing some extra work over the weekend are just some of the ways you could earn some additional money. Think about investing or cryptocurrencies as well, all of which are ways people make extra money these days.
Buying a property for the first time has proven really difficult in recent years with house prices skyrocketing after the pandemic. The demand, however, is still on the rise despite the many factors which could suggest otherwise. Having said that, you could imagine how many people are finding unique and smart ways to save up for their dream homes so with a little determination and a good plan, you could do that too!
This article was written by an online estate agent House Sales Direct. If you wish to sell house fast and for free, then head over to the House Sales Direct website for more property related information and enquiries.