There are many factors involved when preparing to purchase a home. One of the most obvious of these is saving up for your downpayment. What may not be so obvious, however, is exactly how to do that. Putting away money is easier said than done, which is why we’ve compiled a list of four practical tips to help buff up your savings.
The most important step when saving for something as important as a home is to prioritize. Your home needs to be at the top of that list, which means that you might want to postpone your month-long sabbatical to Spain. Saving means that you will have to say no to some things and cut down on most others. Buying a home is a lot like getting married. You’ve got to make the commitment before the papers are ever signed. Build that budget and start saving now.
Think of it this way: Putting money into high interest debts is taking money out of your savings account. You may not need to consolidate your debt in order to pay it off. One of the simplest ways to pay off debt is to work your way up. Start with your smallest high interest debt and work to pay that off. Then use the minimum payment from that debt to help you pay off the next small debt. And so on and so forth. Eventually this will help to free you up so that you can make larger payments against one debt at a time.
Studies have shown that people who use credit cards to pay for things tend to spend more than their cash-carrying counterparts, even taking cash back and point programs into consideration. Keep your credit cards at home so that they can be used for emergencies. Interest rates aside, spending actual money allows you to keep better track of your spending habits. Start utilizing the money you do have, and you will be surprised at how much you save!
Where possible, start to cut down on spending. If you drive two cars, see if you can get away with just one. If you love purchasing books, check out your local library. If you eat out often, look for cheaper places to go or limit the number of times you hit up Denny’s in a week. It’s these small changes that will make a huge impact on your savings. You don’t have to stop enjoying life, you just need to have more awareness about what is going in and out of your bank account.
Buying a home is an exciting step, so follow these tips to make it a reality! Need a little extra help? Here at Source Mortgage, we offer several money-saving services that can assist in your home-buying journey. Give us a call today for more information!
Source was absolutely great to work with - went above and beyond to help us get everything done when buying our new home. Highly recommended!! Chad and Jenelle Richards Jan 09 2013
Chad and Jenelle Richards
Added January 23rd 2013
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