The first step toward owning your dream home is saving for a down payment. Putting 100% down on a home isn’t feasible, so it is instead recommended to put down a minimum 20% to get the best deal. While this is still a considerably large chunk of money, creating a savings plan can help homebuyers to reach their down payment goal in no time.
- Put a fixed amount into savings – Set it and forget it. The easiest way to save money toward a down payment is to set up an automatic deposit. Allocate a fixed amount from each paycheck to go directly into savings and watch the money add up without any effort.
- Reduce your expenses – Homebuyers will be surprised by how much they can save by paying attention to their expenses. Look at your monthly expenses and see where you can save money. Consider taking a break from your gym membership, canceling cable, cutting back on eating out or buying generic over name-brand items on your grocery trips.
- Down payment assistance – Don’t be afraid to look into down payment assistance. Several local, state and federally funded organizations may be willing to provide financial assistance toward your new home’s down payment.
- Skip a vacation – Skipping a vacation may be a bit of a downer, but the money can pay off big time. Vacations are expensive, oftentimes costing upward of $2,000 for travel, lodging, food, activities and more. Put that money you would otherwise spend on your big summer trip and make significant contributions toward a down payment instead.
- Pull from retirement – Pulling from retirement may not be the most popular decision, but it may be a smart idea depending on your financial situation and career stability. Depending on the retirement plan, homebuyers may be able to borrow money from their account to use toward the purchase of a new home.
- Find a side hustle – If you have the spare time, pick up a side hustle to boost your income. Have a hobby you could turn into a side gig? Or maybe a service you could provide like lawn care, tutoring, ride-sharing or dog walking? For those who would rather hone their work skills, there are even ways to make money online as a virtual assistant through freelancing sites.
- Sell your stuff – Planning a move most likely means you’ll be cleaning out your current living space. Go through furniture, decor and clothing items and consider what is worth keeping. Host a garage sale to sell unwanted items or take advantage of online selling sites like Facebook Marketplace, Craigslist or Poshmark.
- Adjust your insurance – If you are comfortable with adjusting your insurance coverage, it can be a great way to save. Talk to your insurance broker about how to save money by increasing deductible amounts or bundling policies under the same provider.
- Hold onto your bonus – Have an annual bonus or raise? While it may be tempting to rush out and spend it on a frivolous planned purchase, you may want to think twice. Instead, think practically and put the money straight into your down payment savings.
- File your taxes – Tax season is in full swing and if you haven’t filed already, now is the time. Tax refunds can offer great returns with the average refund in 2018 in the high $2,000s. Tax refunds are the biggest influx of extra cash many receive all year, so why not put it toward the down payment on a new home?
To learn more about living the sweet life and becoming a homeowner at Spring House at Honey Farms by Brenner Poole Homes, visit www.HoneyFarmsLiving.com.