Saving for your first home can seem like a battle, especially when you have bills, debt, and rent payments to make. It doesn’t have to take you half your working life to save enough to purchase your first property, though – with some changes, you can ensure your savings build steadily.
Work on Paying Off Debts
You should focus on paying off debts before you jump into a down payment for a house. Not only will it help you save enough money for the deposit, but you’ll improve your credit score, which is essential for finding a great deal on a mortgage.
Work Out the Amount You’ll Need
It helps to have a clear number in mind when saving. By knowing exactly what you are aiming for, you can make sure you are putting the correct amount of money to the side each month. Remember to include savings for the down payment, the moving van, and any new furniture you’ll want for your brand-new home.
If you are trying to cut down on costs as a first-time buyer, you should have a look at Linden Homes for a help to buy scheme. By doing this, you’ll only have to come up with a 5% deposit, so you’ll be able to buy your first home much sooner.
Create a Monthly Budget
Having a monthly budget will ensure you don’t overspend each month. Give yourself an allowance for rent, bills, food, and any extras, and then put everything else away where you cannot touch it. It might mean you can’t splurge on clothes each week or enjoy five takeaways a month, but you will reach your savings goal much faster while learning how to handle your finances.
Skip the Getaways
When it comes to saving for a house, you must make sacrifices, and that includes holidays and mini getaways. As fun as they might be, they will only drain your bank account and push back moving day. So, tell yourself there are no trips until you own your house, and reward yourself once you are sitting back in your own place with the holiday of your dreams.
Reduce Your Bills
By reducing your bills, you can then put any extra cash you’d previously have spent on gas or electricity toward your house savings. A couple of simple ways to reduce household bills include: switching the lights off when you leave a room, keeping the heating off, and drying your clothes naturally.
You should also assess your monthly subscriptions and think about whether you need them or not. If you’re subscribed to Netflix, Disney Plus, and Amazon Prime, for example, then you might realise you don’t use all three, and you’re OK with just one or two TV subscriptions.
Rent Somewhere Cheap
If you’re renting a fancy house near the city, then consider moving somewhere a little cheaper until you save up enough to buy your first home. It might feel like a downgrade, but it’ll help you upgrade to owning your own place much quicker. Plus, you’ll be more appreciative when you eventually move!