If buying a house is one of your goals, you need to starting saving money now. With the cost of living and your regular expenses it may seem impossible to save enough money, but there are ways that you can make it happen. It will take some sacrifice and hard work, but it is possible. Below you will find my tips on how to save money for a house.
Even if buying a house is not in the near future it is still something that you need to be thinking about. Purchasing a house will cost a lot of money, but it is an investment. You need to start thinking about ways you can start to put away some money each month so that you can have a down payment when the time comes. Every little bit helps. Plus, having a downpayment will help improve your chances of being approved for the mortgage, and lower your monthly payments.
The first step would be to create a budget. Do you currently use a budget? If not then you can use my free monthly budget printable to start tracking your money. I would also recommend checking out Personal Capital. They offer a free software program that will track your cash flow, investments, net worth and much more. Managing your finances will help to lead you to build your savings account so that you can purchase a home.
When you look at your budget do you have a gym membership that you pay for monthly? Try an alternative like working out at home. It may seem like $20 a month is not a lot but over the course of a year you could potentially be saving over $200. The point is to really start looking at where your money is going to learn new ways to cutback on spending.
If you go out to eat a lot, cut down and cook at home. Put the saved money in an account that you do not use for anything else. Try to cut anything that isn’t a necessity and when you reach a certain savings goal give yourself a treat to reward yourself. It is very easy to get off track and buy fast food or go out to restaurants a lot because of the convenience. Whether you live by yourself or are supporting a family it is best to try to save going out to dinner for birthdays or special occasions. The amount of money saved here can really add up.
Another way to save money to buy a home is to downgrade your current living arrangement and your car. Can you live in a more affordable apartment to help save money on rent and your bills each month. This will be a huge sacrifice, but it will be worth it once you have the money saved to purchase the home you have always dreamed about living in. If you have more than one vehicle, can you make it work with one? Or, maybe you can trade in your expensive monthly car for a less expensive vehicle with a lower payment or no payment at all. Many car loans come with high interest rates, so not only will you be saving yourself the monthly payment, but it will help in the long-run with the amount of interest you would have been paying. I promise you it is well worth it!
If you are buying a home for the first time, you might be able to get some help with the down payment. Go online and search for first time home buyer’s assistance in your state. You would be surprised at the financial help that is available to you. Apply for everything that you may qualify for to increase your chances of being accepted into a program that can help with the down payment. When we purchased our first home we were accepted for the first time home buyers credit, which really helped to offset the cost of the house to make it more affordable for us.
Buying a home is a big expense that takes planning and saving. If you live frugally, cut unnecessary expenses and put the money in a savings account you can save enough to help make a significant downpayment on the home. Even though a lot of these ways on how to save money for a house are common sense and simple information, it is always good to be reminded and start considering the options that will work best for you.
Do you have any tips for saving money for a downpayment on a home?