I have been asked lots of questions over the years as to what is the best way to save a deposit to purchase a home. Whilst I am not a financial adviser and am not providing any financial advice to you, I am happy to share the methods I have utilised to save deposits to purchase property over the last two decades. You may not agree with everything I say however perhaps if you can take the concept and mould that idea into something that you feel you could see working for you, that is great.
Like anything there are many ways to achieve goals however you must first succinctly identify as to what it is you want to achieve. Put your goal in writing and then break that goal down to a step by step process as to how you will achieve this goal.
For example let’s say, you want to buy a house worth $350,000. Therefore you will need 10% of $350,000 which equals $35,000.
Next question is when do you want to buy the house, let’s say you said two years. You then divide the $35,000 by by 104 weeks = $336.54 per week savings required.
At this point you can either say I earn enough money to be able to save this amount above and beyond my weekly expenses or say, gee that is a bit much I might have to revisit my goals and perhaps take three or four years to complete your goal. You might even consider purchasing a more affordable home to reduce the amount you need to save and time as to which it will take to achieve this goal.
If you are like a considerably high proportion of the population and are not disciplined to be able to save money on a regular basis you may need a little help with technology. There are some great Apps and Software Programs that make it easier to become more accountable to achieve savings and can even make it fun.
Whilst I am not endorsing the product some friends of mine are using one App in particular called “You Need a Budget™”. They say they find it really helpful to keep them on track with their savings and daily expenditure and it is apparently simple to use for even the most technologically challenged 🙂 You can download on your Mac or PC …but wait there is more, no free steak knives however there is a free 34 day trial http://youneedabudget.com
Another handy option available through your financial institution is that you are able to set up direct debits from your nominated bank accounts, on whatever payment cycle and whatever amount you prefer. Therefore your savings are always deducted from your account first and what you have left in your pay is what you have to live off, rather than spending your pay and saying I have nothing left to save this week.
I find that once you get started on a savings regime, the less you have the less you need.
What have you got to lose other than a little time and an opportunity to accelerate your savings to buy your first home, pay off your credit card, go on that family holiday, or whatever that goal is for you.
I would love to hear your best saving tips, so please feel free to post a comment and I will publish for the readers.