When you used to dream about your ideal house, you thought all of the small details; what the curtains would look like, what color the carpet or tiles would be, right through to where your washer and dryer were going to be placed.
What you didn’t think about what the mortgage you would need to pay for it all. More importantly, the large deposit you would need to save to secure a decent mortgage rate and terms.
If you find yourself in this position, trying your best to save furiously for your home deposit, below are some tips which can help.
Wait to Live the Life
One of the first mistakes that a soon-to-be homeowner makes is to move into the area they want to buy. Sure, it’s a nice idea to start your life and to make friends in the neighborhood, but if you have chosen to buy a house in a relatively nice area then the chances are that your rent will be high. Unnecessarily high.
For this reason, it’s best to look for an area within proximity to your dream location but with a significantly reduced rent. This is the easiest and best way to keep your monthly costs down and contribute more towards your home deposit savings account.
Don’t Blow Your Budget
Easier said than done right? Wrong! The main reason why people blow out their budget each month is that they don’t allow for unexpected expenses or entertainment and social costs.
For example, if you are living on a strict budget then you will easily become bored sitting at home with nothing to do. This will easily turn into a period of online shopping where you think to yourself that, seems you’ve already bought one thing, might as well buy more.
Of course, before you know it you don’t have any money left and you’re back at square one just with the feeling of guilt.
Instead, allocate money for a few social expenses and buy them in advance. For example, buying your general admission movie tickets and your vouchers from the Groupon Coupons page for Aerie at the start of the month is a great way to ensure you have something to look forward to and you can manage consistent savings.
Bring Your Debt Together
If you are paying little more than the minimum amount required on a range of small debts then you aren’t improving your financial position and are wasting valuable deposit money.
Instead, look for a debt consolidation loan which can roll all of your smaller debts into one larger debt. The two immediate benefits to this are a reduction in the interest you pay each month, leaving you more to save for your deposit, along with making your payments more manageable.
Saving for a home deposit is no easy task, but it is an achievable one. Remember that every small piece of savings helps, so don’t overlook relatively small savings as they can accumulate into a serious boost to your home deposit account very quickly.