How to Save for a New Home Purchase

17Getting on the first rung of the property ladder has become increasingly difficult in recent years. Banks usually ask for a deposit of twenty per cent, a fact which generally leaves prospective first time buyers reeling.

So saving up to buy a house can be trying, especially if you have to pay rent on your current house or flat. It is essential to be prepared to cut back on your current expenditure to be able to save up for your deposit.

Here are a few ways you can get your spending into line and raise enough money for your dream house.

Set a target

You should try and set yourself a target for every month, this will help to motivate you and keep you on track. By calculating how much money you need to save every month and setting up a direct debit, which takes money out of your account every month after you have been paid, you will have a realistic idea of how long it is going to take to save up enough money for your deposit.

Shop around for the best interest rate

By looking into all the different types of bank accounts you will be able to get the best interest on your savings. Bank accounts offer differing interest rates, so make sure you shop around for the best deal.

Curb your spending

Every time you avoid spending money on luxury items you should pay the amount you would have spent into your deposit savings account. You will be able to put away a significant amount of money by doing this.

It also keeps you in the saving frame of mind and every time you look at the balance on the account you will be spurred on.

Find cheaper accommodation

Moving in with your parents, if possible, will save a huge amount on your bills and rent. If this is not an option then you could consider finding cheaper accommodation. Every dollar you save on your rent can be put towards your new home.

Compare energy prices

There may be cheaper companies out there and by switching energy providers you could save a significant amount of money. You should also look at your bills; do you really need a car or cable TV?

Could you repair a garden hose on your own and save money on your water bill? By cutting out little luxuries you will be surprised at how fast you can reach your target.

Save every dime

Put all your loose change to one side at the end of every week. It may be a small amount of money, but every little counts.

What type of tactics do you use to save for a large purchase?

If this post really resonated with you and you want to transform how you feel and think about money so you can live your best life, consider money therapy.   
 

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