Purchasing your first home is a thrilling, albeit daunting, task. There are many factors to consider, the most important being what your budget looks like.
Once you utilize a house payment calculator you’ll have a clearer picture of what you can afford. Once you know your budget, you can start saving to accomplish your financial goals.
You can put down anywhere from 3 to 20 percent on a home, though 20 percent is often thought of as an ideal amount.
Set a clear savings goal to work toward, then eliminate some of these expenses to help you reach that goal.
1. Impulse Buying
We all fall victim to it: You’re surfing the web and an ad pops up for a home gadget you simply must have. And, look, it’s on sale!
Your inclination will be to capitalize on the sale and buy the gadget now. Ask yourself: do you truly need it?
Take a look at purchases that have happened over the past year and determine how many of them were impulse buys. This will give you an idea of how much money you could be saving yourself if you simply put the credit card down and wait 24 hours before officially making a purchase.
It’s a hard habit to break, but asking yourself if you really need something can help you save a lot of money.
2. Monthly Expenses
There are two categories of monthly expenses to look at here: necessities and nice-to-haves.
Necessities are things like car insurance and utilities. Can you shop around for a cheaper monthly rate with a different company for any of these things?
Subscription services like Netflix, cable, and gym memberships are nice to have, but most likely not totally necessary for your day-to-day life.
If you have both cable and streaming, can you cut the cord on cable completely and live off Hulu for a little while? When’s the last time you’ve been to the gym?
Look at what payments come out monthly and determine which you can forego, at least for a little while to put money back in your pocket.
3. Dining Out
Grabbing a Starbucks on the way to work or having a traditional Friday night out at a restaurant is certainly nice, but is it something you can not do for a little while?
These expenses add up. Instead, check the flyers for your local grocery stores to see what’s on sale so you can shop smartly and build at-home meals from what you buy.
If you’re pressed for cooking time, take a chunk out of one day and meal prep for the week.
Vacations are beneficial, but so are staycations.
If you need time off of work take it, but consider staying in the comfort of your home instead of springing for a week at an inclusive resort.
Many people find themselves in the position to buy gifts for special occasions throughout the year, particularly during the holidays.
Work with a smaller budget this year, and consider making homemade gifts to cut costs. If your loved ones know you’re saving for a home, they surely won’t mind.