Tips on Saving for a Down Payment

Tips on Saving for a Down Payment

If you’re thinking about purchasing a home, one of your major concerns is probably how you’ll make it work from a financial standpoint.

Saving for a down payment on a house is entirely realistic when you take some time to rethink your spending, savings, and small sacrifices.

Here are some ways to start making your wishes of owning a home come true.

Open a Separate Savings Account

A convenient way to save, opening a separate savings account allows you to transfer money directly from your main account into a special account each month. Plan to keep this account exclusively for your down payment and do not dip into it for other reasons. Keeping a separate account helps you save that pot of money specifically towards a down payment, and automatic monthly payments will ensure the account keeps growing, even if it’s small.

Cut Unnecessary Spending

Take a look at your spending to find out where to make some critical cuts. If you eat out often, consider buying groceries and preparing meals at home to save a considerable amount of money. Start making your coffee before work and save a bit each week on frequent coffee stops. Review your cable bill or cell phone bill and see if you can find a deal or promotion that could lower your monthly payment.

Prioritize Credit Card Debt and Rewards

Interest rates make paying off your credit cards substantially difficult. Assess your credit card debt and start paying off your credit card with the highest interest rate. Once paid off, close the card and move to the next highest-rate card. Cutting your credit card debt helps you focus on your savings. Find credit cards that give you rewards like cash back or discounts and put any saved money towards your down payment.

Consider Alternative Ways to Make Money

Think about getting a temporary second job to save some extra cash each week. Odd jobs like house sitting, dog walking, and tutoring help you add some much-needed extra income to your down payment savings account. Hold a garage sale to get rid of some unwanted items which will make your move easier in the future.

Ready to find your next home? Big Sky Brokers are experts in the Helena and surrounding areas of Montana and can help you find the best home for your budget.

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