The new year is upon us. Is your resolution to buy a home? Here are some tips to save for a home purchase in a year.
How much do you need to save? Decide on your budget before you even start browsing homes online. This will help give you an idea of how much you need to save for your down payment. Some home buyers put down 20% sometimes 3.5% or any amount they have. Talking to a lender would be a good idea to determine a loan you are comfortable with, as well as a budget.
Create a budget. Knowing where you are spending your money is the first step to saving. Make a list of your income and expenses. If you feel like you can’t save money, start reducing the budget by 5 to 10 percent across each category. It may not look like a lot, but you will be saving a little each month.
Pay down debts. Make a plan to pay down debts. Start by paying down debts with the highest interest rate first. After debts are paid the monthly payments can go straight to your savings fund. As you are trying to pay down debts you will become more aware of what you are spending.
Reduce the amount you spend. Get creative! Spend less. Buy generic. If you look at the labels most of the ingredients are the same on items that are store brands. Cut off the cable bills. Many streaming services are available and cost much less each month. Start a garden. Grow some of your own food. Use energy efficient electronics and light bulbs to lower your electricity bill. Go to the library instead of buying books. Cancel monthly subscriptions. Borrow things, or rent them, don’t buy. Many hardware stores offer rentable tools and such. Or borrow items from friends you only need to use once or twice. Eat in, make your own meals instead of going out or ordering delivery.
Pay yourself first. Start transferring money to your savings account before you start spending. An easy way is to set up an auto transfer on your bank account to transfer a set amount when your paycheck arrives. Do not wait to see how much is left in your bank account at the end of the month to determine how much to save. Chances are, there will not be much there.
Sell your stuff. Take a look around. Have anything you don’t use? Sell it! And save the cash. In the end you will have less to move when the time comes.
Start a side hustle, or get a second job. Have a skill you can use to get paid? Start a side hustle to generate some extra cash. Spring is coming, often times seasonal jobs are available on part time basis to help earn some extra cash.
For current market information for your Lafayette and West Lafayette communities or a free consult, contact The Aimee Ness Realty Group Keller Williams Lafayette Indiana. Our team with over 10 years of local experience, has your back to find your dream home, or sell your current home.