TIPS ON HOW TO SAVE FOR A HOME.
Once you know find your dream home, it’s time to start saving for it. Whether you are just starting to save or already have some money saved, here are some tips to help you save for your future down payment.
With inflation on the rise and the cost of living crisis affecting us all reducing your outgoings might not seem easy. However Budgeting can help you save up money you need to buy a home. Budgeting is easier than it sounds. First you have to look at your income vs your expenses. You should mainly focus and keep track on your fixed expenses e.g. rent utilities and other bills. Decide how much you want to place in your savings account and from there you’ll figure out how much you’ve left to spend. The main goal is to have a realistic budget and it’s easier to save from there.
Open an online savings account.
Nowadays banks offer online savings accounts that customers can create anywhere and at any time. Online savings account helps you may help you earn more compound interest on your deposit and as they continue to raise their rates the more the user earns solid compound interest.
Automate your savings account.
Make sure you automate your account monthly as you set it up. This way part your pay check will automatically go to your savings before you are tempted to spend it elsewhere. This will help curb the urge to spend your pay check on unnecessary items and this makes a big difference.
Work on improving your credit score.
Your credit score is a major factor whether or not you will qualify for a home loan. You are going to need a strong credit score in order to secure a mortgage from a bank. The bank won’t lend money to just anyone. One of the ways to improve your credit score is by paying off debt and continue making minimum payments as well.
Start a side business or a second job.
If you have a typical 9 to 5 job it’ advisable to start a side hustle or a second job. By earning more cash on a monthly basis you’ll be able to save faster. Few examples are online writing, babysitting, driving an carb ,tutoring, photography ,selling artwork or clothes and many more and you may also decide to find a new job and start brushing up on new skills.
Move to a cheaper area or find a roommate.
Some ways to reduce your monthly expenses is to a smaller apartment or more affordable area and you might find yourself enjoying a more minimalist lifestyle or finding a temporary roommate to split your monthly rental payment in half. You’ll be able to split your bills and general needs with your roommate and this will dramatically cut down on your cost.
Skip on vacation.
As much as travelling for a vacation is rewarding it is also costly. Instead of travelling out of the country or out town you may consider taking shorter local trips e.g. you may visit your local museum, go hiking or plan a DIY at home or have a staycation with your friends and family.
Save your end of year bonus
The end of year is usually a merry time and you may tempted to spend your end of year bonus on clothes and eating out. Instead deposit into your savings account as soon as possible as this will boost your savings and speed up your home buying timeline.