Saving money is never easy. When you’re hoping to purchase your first home, saving is a necessity!
Try these cost-saving tips and soon you’ll have a nest egg to put toward your new place.
1. Make a budget and stick to it. Consumer.gov has tips for making a budget. Create your budget and then commit to sticking to it (knowing that hard work will pay off when you find that beautiful home to call your own)! Be sure to track what you spend. And make sure to avoid any unnecessary spending – this is not the time to be buying a new car or making any similar large purchase.
2. Talk to a lender about what you can afford. I know it’s exciting to go out looking at homes. But before doing so, you owe it to yourself to speak to a lender. Your lender will ask about your income and expenses and, within about 10 minutes, will be able to calculate what you can afford. Your lender can also help lay out all expenses associated with purchasing a home (i.e., not just the mortgage). These expenses include: homeowner’s insurance, taxes and utilities, among other things. Finally, you need a lender to be pre-qualified. Prequalification is something virtually every seller requires before an offer will be considered. (I know of several terrific lenders. Call or text me for their names and contact info.)
3. Start to save as soon as possible. It’s never too soon to tighten your belt. Remember, you’re saving for the most expensive purchase of your life so the sacrifice is well worth the effort. Choose to cook instead of going out to eat. Watch movies on Netflix instead of going to the theater. Even saving $100+/week can add up quickly.
4. Create a separate savings account for your deposit. If your paycheck is direct deposited, you may want to look into having a portion of it automatically deposited into a separate savings account, earmarked for your deposit and related homebuying expenses. Having a separate account serves as an additional reminder not to touch it.