Saving enough money to buy your first home is no easy feat, but it’s a milestone many of us aspire to. Even if your goal seems miles away, there are some small changes you can make in your life to get there quicker. Whether you’re a compulsive spender or already keeping a tight hold on your purse strings, this blog will give you some top tips to get you closer to your dream property.
Set up the right bank account
Bank accounts aren’t all created equal. In fact, some will suit your savings needs better than others. Always check to see how much interest your money will earn and make sure you compare providers. Just because you’ve been with a particular bank your whole life doesn’t mean you have to stick with them.
You’ll also want to know all the rules attached to the type of account you’re opening. Some bank accounts will reward you with higher interest rates if you don’t take out any money for a number of years, while others give you a bonus for saving a certain amount each month. It doesn’t matter if you choose to open a lifetime ISA or a stocks and shares bank account, just make sure it suits your timeline and goals.
Set a goal
Lots of people start saving for a home with no real idea about how much they need or when they want to achieve this. While starting to save early is better than leaving it too late, it can be difficult to maintain if you’re cutting down your spending indefinitely. Consider how much you earn and the prices of homes in the area where you live. Aim to save a certain amount each month and work out how long it will take you to build up enough for a deposit. If you’re struggling with this, you can always speak to a financial advisor.
Cut down on living costs
This is easier said than done, but it can be done. If you’re currently renting a home by yourself, you might be able to save money by moving in with friends, a roommate, or your partner. Some people even choose to temporarily move back in with family while they save for their deposit. These options might not work for you, so you’ll want to consider reducing your utilities by shopping around for new providers or temporarily reducing the number of holidays you take each year. Even simple changes like canceling unused subscriptions or eating out less can make a big difference.
Start a side hustle
If your current earnings aren’t enough for both living and saving, consider starting a side hustle. This doesn’t have to involve a lot of work and could even be linked to a hobby you currently do. Some side hustles eventually lead to you being able to make passive income, which helps you to save both time and money.
There’s no quick fix when it comes to saving for a home, but small changes can send you on the right path.