When you are trying to save for a brand new home, a strict budget will help you to reach your goals sooner. There are smarter ways to budget and get the deposit you need, so you can stop paying rent and start paying off a mortgage!
If you are having difficulty saving, but the dream of becoming a homeowner is something you want to make a reality, try these budgeting tips:
Boost Your Savings
Most lenders will require a significant deposit, and it can feel like a slow process trying to reach this financial goal. Choose an account with a high interest rate, then save, save, save to take advantage of this. It you find it hard to resist that spending temptation, ask for an account with no internet banking or instant payment methods.
Look around your house and see whether you have any items you no longer need, that could be sold for cash. Be patient as sometimes the right buyer will be prepared to pay a little more. Remember, it all adds up and the more money you add to your savings, the better.
Reduce Your Debt
Credit cards and existing loans will likely have high interest rates, and once you have paid these off you will see your savings grow. You may be able to find a better deal by consolidating your credit cards, while making the most of interest free periods.
Once your existing debts are paid, you can automatically redirect the extra money into your savings account. Use a spreadsheet or dedicated app to monitor exactly where your money is going.
Think about other ongoing expenses you may have, and try to reduce these. For example, do you really need 3 different streaming services? Try to avoid late fees, and pay on time if it means receiving a discount.
Round It Up
These days, there are a number of banks and apps that will help you save by rounding up your loose change. In this cashless society, you probably won’t notice those extra cents you save by paying with a card.
When you make purchases, you can round up to the nearest dollar, or five, and this will automatically be transferred into your savings. Your morning coffee or new outfit could actually help to save you money!
Get Some Advice
If you are a first or second home owner in WA, it can be worthwhile getting advice. You may be eligible for a Keystart loan which could give you access to finance with very little deposit.
Dreamstart Homes can assist you with this application process, and have a range of house and land packages in Perth that are exceptional value. Whether it is north or south of the river, there is a location and a design to suit your needs and your budget.
Dealing with a traditional bank might make the road to home ownership a longer one, and a simple chat could help you to clarify your goals.
The Bigger Picture
In the short term you may have to forgo a few things in order to reach your savings target. It could mean saying no to a concert, overseas holiday, or a new pair of shoes. However, this is only temporary and will be well worth it.
When you have a strict budget, reduce your debt, round it up, and seek professional advice, you may just be able to get into your brand new home…sooner!