You’ve decided you’d like to purchase a new home in the near future. You know you’ll need money for a down payment, but how can you save money each month? Here are a couple of strategies that will making savings for a home a little easier.
- Transfer a fixed amount of money each month from your paycheck into your savings account. An automatic direct deposit is a great way to save money without missing it. Commit that you will not spend the money you save.
- Lower your monthly expenses. Deciding what you can reduce or eliminate from your spending by creating a budget makes sense. For instance, do you really need that five dollar coffee each morning or that monthly gym membership? If you want a house more than these items, put the money you would normally spend aside and into your savings account. You may be grumpy each morning, but you will save money by making a cup of coffee at home instead.
- Similarly, if you are used to making purchases randomly or spontaneously going out to dinner or picking up take out food on the way home from work, you may want to rethink these habits as well and investigate how much money you spend each month. This may be a great area to save some additional money each month.
- Picking up a side hustle by working in the evenings or over the weekend temporarily can increase your monthly income. Throw that money into your down payment savings fund and see your balance quickly rise.
- Reduce high monthly credit card rates by transferring balances from card with higher interest to those with the lowest interest rates. You can also try to pay off those with higher balances first to eliminate the higher monthly payments.
- Forgo the vacation and place the money you would have spent into your down payment fund. You may not realize how much the vacation costs. Add up the cost of the vacation as a whole with the food, travel expenses, excursions and hotel bills. This may be your down payment!
- Ask For Help from friends and family. Instead of presents over the holidays and on your birthday, ask for money instead. There are limits on the amount of money that can be gifted to you so be sure to speak with your real estate agent and mortgage professional to determine the amount.
Hopefully these strategies will enable you to some additional money each month for your down payment. When you are ready to begin your search in Carmel, Indiana or the surrounding cities, reach out to Keith Albrecht and his team at 317-590-7878 or email to Team@KeithsHomes.com. With over 25 years of experience, we’d love to help you make your dream of owning a home come true.