My husband and I harbour a long-standing dream of owning our home. This aspiration has consistently been postponed due to competing concerns such as advanced education, job-related training, and a hefty student loan debt of $14,000. We’ve managed past financial impediments by reducing our expenditure and generating additional income through various freelance opportunities. This allowed us to minimize our debt and accumulate savings.
Now, we’ve introduced a new financial objective into our itinerary – saving for a house down payment. For years, the prospect of owning a home was but a mere figment of our imagination, typically discussed in the context of “One day…” or “If only…”. However, this year we dared to change our approach, choosing to commence our savings while still repaying our debts.
Our initial approach towards saving for our home was rather spontaneous and intuitive. In March, we resolved to start saving for our down payment, beginning with roughly $3,000 in our savings account. Come June 1st, our savings have grown to $10,000.
We managed to save an impressive $7,000 in less than four months. While this is far from our desired down payment, it propels us to continue saving and amplifying our fund.
So, how did we accomplish this? We adopted a similar strategy for saving up for our down payment as we did for managing our debts. Here are the steps to our down payment savings plan:
1. Prioritize your Saving: We enabled automatic deposit, directing $500 from our paychecks into our house down payment fund each month, pocketing an automatic monthly saving of $1,000. Automatically transferring this amount into a separate savings account lets us leave the money untouched. We gradually worked our way up to saving $1,000 a month, starting with smaller increments.
2. Work Harder: The monthly $1,000 was our minimum saving goal. To save more, we needed to earn more. Any money made from freelance work was set aside for debt payment, tuition fees and recreation. To earn more, we dedicated more hours to our regular jobs, vowing to put any bonus earnings straight into our house deposit fund. We know our living costs and allocate each extra cent earned on overtime work towards our home savings.
3. Allocate all Additional Funds: We redirected every last spare penny of additional income towards our house down payment fund. Inclusive of rebate checks, mileage reimbursements and tax refunds, this small sums can quickly build up.
We are thrilled by the substantial progress we have made within such a short span of time and that motivates us to continue saving.
