Saving for a deposit is no easy task. For first home buyers and investors alike, it can be challenging to stash money aside and accumulate a growing fund despite the already-draining everyday expenses. The good news is that while it is difficult, it is still possible with a bit of planning and determination.
If you’ve been thinking about it for some time but haven’t made much progress to save that much-needed deposit for a new home, don’t be discouraged. In a shorter amount of time than you’d expect, you can be signing the contract to your very own property. And we’re here to help you do just that with some handy tips.
Recognise Your ‘Now’
Before diving into the deep end with uncontained ambition, it’s necessary to step back and take a look at the current situation in your life. What kind of income are you earning? Do you owe any debts? Are you committed to any compulsory payments?
Write down what you earn and what you spend week-to-week, month-to-month. It will give you a more thorough understanding of your financial situation, and helps for the tips below! Be real with yourself about what you’re saving now and what potential you have to save even more.
Set a Goal
Do a bit of research and learn about the kinds of properties on the market. Investigate the difference between various suburbs and the types of housing, and see what they have to offer. From there, you’ll understand what to expect from different price brackets and, most importantly, how much of a deposit you’ll need for the kind of home you’re after.
Find something reasonable and attainable, keeping in mind your ‘now’ position. Once you have a rough figure, you’ll then have a clear goal in mind. Never steer away from the goal!
Prepare & Plan
Get yourself a big calendar or diary and jot down everything that you’re anticipating to pay for over the upcoming months – everything from family trips to Christmas presents. Budget how much you plan on spending at each event and occasion.
While forecasting your upcoming social events, if you find that you have spare weekends or a less hectic schedule, the greatest thing to do would be to utilise that time with a second job. A second income means more savings!
Be realistic about what you can commit to without finding yourself in a state of exhaustion. Review your plan and see what you can sacrifice to reduce spending over the year.
Cut Out the Luxuries
Speaking of sacrifice, in order to put a little extra money in the piggy bank, you’ll need to learn the power saying of ‘no’ to yourself when wanting to indulge. No to $5 barista-made coffees (instant will do!), no to $30 gold class cinema tickets (movies at home are just as fun), no to fashion sales (if you don’t need it, it counts as a luxury) and whatever else comes your way as a spending temptation.
Of course, you’re not meant to be miserable while saving, but allow yourself a splurge by anticipating it. If you know you’re catching up with friends at the latest restaurant in town, make that your splurge for the week and enjoy it. It’s all about balance and being conscious of your spending. Set aside whatever you would have spent and you’ll see your savings skyrocket before your eyes. To put things in perspective, a coffee a day equals to almost $1500 at the end of the year – that’s a huge saving from just one small luxury!
Stay Consistent & Conquer!
All of these tips will make you successful on your saving journey only if you have a focused mindset and determination. Remain consistent with your commitments and positive changes, and you can have a sufficient fund for a home deposit much sooner than otherwise. Speak to a New Living Homes team member today about how affordable a new house can really be!