Buying your dream home can be stressful especially if you haven’t saved enough. It might seem impossible at first but if you cut back on extra expenses and spend wisely you can save a considerable amount of money quickly. With the job market improving and interest rates still being relatively low, it is certainly the right time to think about investing in a home.
If you are looking for tips to save money for your home, then we have some good news for you. We have compiled a list of 5 everyday saving tips that can help you plan your savings better.
Open a home savings account
While planning to buy your dream home, it is extremely important that you open a separate savings account where you store all the money that you’re saving for your dream home. Make sure to look and compare savings account to view interest rates and see, which account works best for you. The best way to save on taxes and save more money is by duly paying advance taxes and furnishing all deductions during returns. Try and give yourself a 14-days’ notice if you wish to access the money, this can be a good way to avoid the temptation to spend on impulse!
Estimate the money required
Before you begin your journey to save for your home, estimate the total amount you need. This clarity will help you chalk out a clear plan as well as help you assess the mortgage application required by the bank for a loan. It will also be helpful if you start investing, early right from the age of 25 on mutual funds or trustworthy chit funds. Do consider partnering with someone in the family to save up more. An extra help from parents and spouse is always welcome!
Sort your everyday budget
Once you finalize how much you need to save it is time to get your finances in order. While planning your budget make sure to include your day to day expenses like coffee, lunch or travel. For instance, you could probably take shared cabs or use the public transport to reduce your commute costs to work. This will help you give a clear view of your finances and help set realistic saving goals.
Reduce your household costs
The first thing you need to keep in mind is that you must never pay heavy rents while saving for your own home. Small things like switching off lights, plugging out the chargers and looking for the best deals for TV, internet & phone contracts might seem silly, but it can help you save a good amount of money in the long run. Even though these expenditures might seem trivial, some research and thought can help you put a cap on unnecessary expenses. Invest time in researching while buying expensive goods to find an alternative. If you have to buy something, buy it during the festive season as you are likely to get better discounts!
Prioritise the events you’re attending
Once you have your budget sorted and a clear estimate of the money you need to buy your dream home, work out how much money you have to spend on treats and try to stick to it. Reduce the amount you spend on gifting by prioritizing the events (marriages, parties, gatherings) that you would like to attend and adjust them in your budget accordingly. This way you can control how much you spend. This also includes the amount of money that you spend on vacations. Book your tickets early, look for reasonably priced hotels instead of being extravagant!
Be consistent towards building your savings and clear the hurdle to make your dream home a reality.