Saving for your first home deposit can be a bit of a daunting task. With the cost of living increasing it can seem impossible to also think about having to save for a home loan. It doesn’t have to be as difficult as you might think. There are several different strategies you can adopt to help get you on the right path
Budget
Budget is the most important factor in your strategy. Finding an easy solution to tracking your budget will be the quickest way to success. Whether you choose to download and app and log your daily spends to keep an eye on patterns and places you could improve, or maybe give yourself a weekly spending allowance that you know save you money from the get go. There are plenty of ways to budget but not every route will work for everyone – find the best one that suits you and keeps you motivated.
Sacrifice’s need to be made
What can you sacrifice to scrape a few extra dollars together each week? To stay on track make sure what you sacrifice is not going to dip your motivation. Whatever you sacrifice replace with something new and exciting that’s a money-friendly exercise. If you’re sacrificing your weekly restaurant meal make sure you replace it with something fun and exciting – try a new recipe each week from a different country or mix it up by taking turns with friends to cook dinner for each other. The sacrifice needs to be worth it in order to make it a habit and to ensure you stick to it. A new fun, free or cheaper activity is the perfect way to stay on track!
Do your research
It’s important when thinking about embarking on the home owning journey to know what a realistic goal for you and your family is. Overcapitalising on your first home is not a position you want to be in. The ideal scenario for a first home buyer is a smaller home that you can put a little bit of money into to increase your gains when you’re ready to sell up and find your next home. Talk to a broker about what is a realistic goal for you financially and make sure you’re covered for worst case scenario. Interest rates are likely to continue rising so preparing for it now ensures you’re covered. A broker will also be able to help you discover what grants and boosts from the government you are eligible for. They will be able to offer advice on what you can do to become more eligible for financial support.
Get money Savvy
Have you ever tried ringing your insurance company and asking for a discount? Many people aren’t aware that with a bit of bargaining and shopping around on your utilities and expenses like insurance, that you can actually save yourself a lot of money each year. Set yourself a date in the calendar to sit down each year and go over each utility and bill and see if you can get a better rate and if not, shop around! This goes for everything – if you’re super savvy you’ll even know to look into your bank each year. Interest rates change frequently. Make sure you’re getting the biggest interest percentage on your deposit account – every little bit counts.
Owning your own home is a big part of the Australian dream. With cost of living on the rise it’s a stretch for some families (especially those renting in a high-priced market) to think about putting those few extra dollars away to save for their own home. With the right motivation and preparation it’s not an impossible dream!
