Acquiring your first house is a thrilling yet demanding journey. You’ll be juggling tasks from liaising with real estate agents, navigating industry jargon, preventing premature emotional investments into a property, to organizing your finances. The foremost steps to reckon with involve deliberating on the amount you plan to finance and the sum you will reserve for a down payment. Concerning down payments, a higher amount is always preferable. If you aim to evade private mortgage insurance, you might want to consider a down payment of at least 20%. Depending on your budget, your dream home may necessitate a down payment ranging from $20,000 to over $40,000 (if you’re interested in achieving the 20% threshold). But how can you amass such an amount without years of waiting? Here are five strategies to bolster your savings for your first home acquisition.
1. CONSIDER AN ADDITIONAL SOURCE OF INCOME:
Boosting your earnings is often the surefire avenue to ramp up your savings. If you already have a full-time job, think about securing a second part-time job or kick-starting a side gig for additional cash flow. If you’re purchasing the house with a spouse or partner, you both can explore these alternatives until exhaustion sets in. While sustaining this might be challenging for a long while, the more income you bring in, the better. Bear in mind that this approach might be better suited for those without children or other pressing responsibilities due to the level of commitment involved.
2. REDUCE SIGNIFICANT EXPENSES:
Making sacrifices goes hand in hand with savings. One surefire strategy is to prune a major cost from your budget either temporarily or permanently. Perhaps there is something you’ve been overspending on but can live without–consider relinquishing it for your primary goal of becoming a homeowner.
3. EXPLORE HOME BUYER’S AID PROGRAMS:
Various home buyer’s assistance programs exist nationwide to lend a helping hand to first-time home buyers. They offer many benefits, from down payment grants to covering closing costs. Eligibility varies with income limitations and family size. But you should explore these resources as they can be remarkably beneficial.
4. ADJUST YOUR INCOME WITHHOLDINGS:
If self-discipline poses a challenge in your savings plan, request that your employer withhold a larger portion of your income. This forces you to prioritize home savings over other expenses.
5. MANAGE GIFT MONEY JUDICIOUSLY:
Should you receive gift money on special occasions or holidays, deposit it directly into your home savings account. Even selling gift cards for cash can bump up your savings.
Saving for a house down payment can feel overwhelming, but remember, every little bit helps. Cut costs, seek additional income, utilize all saving opportunities, and keep the end goal in sight. Do you have a home? How did you save up for your down payment? How much did you save?
