We live in a world of convenience and endless choices. To watch a TV show, you can find it on cable, Netflix, Amazon Video, Hulu, and more. Sometimes, all of these options make it easy to spend more than necessary on monthly services.
If you’re hoping to buy a home in the near future, one way to save a bit more each month is to cut corners wherever possible.
In today’s post, I’m going to cover some tips that will help you start saving toward the down payment on your first home.
They’re enticing, the myriad of entertainment services that we can now take advantage of. For a seemingly low monthly cost you can have hundreds of channels through cable. However, many cable users have noticed that their cable bill keeps creeping up each year and the service doesn’t get any better.
One way to start saving more each month is to ditch cable altogether. For news and the weather, there are many websites available. And, some local news stations stream live on their websites for free.
But, what about watching your favorite TV shows and movies? One of the world’s best kept secrets is that of interlibrary loans. Most public libraries are part of a system that allows you to get books, games, movies, and TV shows shipped to your local library for free. You simply reserve the latest season of Game of Thrones and wait for an email from your library.
Another issue many people have with monthly entertainment services is their tendency to add up. Reassess your monthly bills. If you’re paying for Netflix, Amazon Prime, and Hulu, do you really need all three?
To save effectively, make sure your savings account is seeing a high return on its interest rate. Online banks tend to have higher returns than their brick & mortar counterparts, and most people don’t need to make regular visits to a bank anymore anyway.
Similarly, for credit cards, choose one with cashback rewards. Only use your credit card for necessities, like groceries and gas. Then, pay off each statement in full each month. Once you get your rewards, use them for more groceries and gas or put them in your down payment savings account, if possible.
One of the most effective ways of saving for a down payment is a certificate of deposit. CDs are perfect for down payments because you aren’t able to withdraw from them until they have matured--i.e., until you’ve reached your savings goal. They can be set for 6 months, a year, or more, and they tend to have higher returns than savings accounts.
Using a combination of these methods will help you start saving more each month so you can achieve your dream of owning a home sooner.
Purchasing a home is a sign of new financial responsibility for many people. The leap into homeownership is a big and important step. Finding a home and securing a mortgage isn’t easy. Getting ready to take on a mortgage can require a lot of research and education on your part. Before you get too confused, you’ll need to learn the basics of a mortgage and what you should know before you apply.
This is probably the best advice for any first time homebuyer. Find some good lenders in your area. You can sit down with a lender and talk about your goals. The bank will be able to explain all of the costs and fees associated with buying a home ahead of time. This way, you’ll know exactly what to expect when you head into a purchase contract without any surprises.
Each mortgage is a different situation. This is why meeting with a lender ahead of time is a good idea. Your real estate agent can suggest a mortgage lender if you don’t have one in mind. No one will be happier for you than your real estate agent if you have a smooth real estate transaction. You’ll be able to walk through the mortgage process step by step with a loan officer and understand the specifics of your own scenario.
There’s a few things that you’ll need to have ready before you can even begin searching for a home.
You’ll need to save up a bit of cash before you know that you’re ready to buy a home. It’s recommended that you have at least 20 percent of the purchase price of a home to put down towards your loan initially.
You should have an understanding of your own finances in order to buy a home. Not only will this help you save, but it will help you to ensure that you’re not going to overextend yourself financially after you secure the mortgage. To get your finances in order, honestly record all of your monthly expenses and spending habits, so you know exactly what you can afford.
If you have an idea of what kind of home you’d like, it will make your entire house shopping experience a lot easier. You’ll be able to see exactly what you can afford and how much you need to save. When your wish list equates to half-million dollar homes, and you find that you can only afford around $300,000, you don’t need to go into shock! It’s good to have an idea of how much house you can afford and what it will get you. When you do a little homework, you’ll discover that buying a home isn’t such a hard process when you’re prepared!
