How to Save for Your First Home

That savings plan

Are you geared up towards buying your first home? If yes, without wasting a minute, start saving. Of course, the first home owner’s grant is there to get your started; moreover, depending on your state, there are other grants, incentives and stamp duty exemptions you can access. However, you might need several thousand dollars in hand to use as a deposit to buy your first home. Given below are some killer tips to help you boost your savings and make your dream come true.

Saving tips for your first home

Plan a budget. And, stick to it. Try not to spend on unnecessary items and impulse purchases because this type of spending usually delays your long-term dream of owning a home.

Save 10% of every paycheck. Prioritize home deposit. Have a separate bank account and set up an automatic transfer for each pay day. Make top-ups as and when possible. You just have to pay yourself before paying anyone else.

Pay off your debts. While this isn’t a direct savings tip, it is so by default. You will be saving a lot on interest payments. In fact, paying off your pending debts makes a lot of sense for two key reasons: it increases the amount of cash you can borrow & it frees up your money to use towards the mortgage repayments. Paying off your credit cards / any personal loans or hiring purchase agreements certainly helps. Furthermore, reducing or eliminating such debts certainly increases your borrowing power.

Try eliminating luxuries. Record as well as analyze your expenditure for a month in order to reveal opportunities to save. Write down everything, even miscellaneous items like taxis, coffees, gifts and meals out. Needless to say, these daily extras do add up over time.

When you hear, “eliminate luxuries,” it doesn’t mean you have to let go of everything all of a sudden. You can choose to eliminate one luxury every month, save some money and then move onto the next thing. You will be surprised at how much you have saved in a year’s time!

Get a suitable part time job. If you are serious about saving a deposit and your finances seem to be already stretched to capacity, consider looking for some extra work. If you work for a couple of evenings in a week, you can easily make $1,000 a month and that means $12,000 in a year! Think freelance writing, graphic designing, tutoring high school students, taking language classes and so on. Pick your cup of tea.

Follow these tips, save cash, buy a home and be a proud, happy owner of your first home!