If you have dreams of owning a home, there are some important steps you will need to take in order to move closer to this reality. One of these steps is likely to be to save towards a mortgage down payment. With that being said, this can take a lot of planning and even some time to save up enough money. To add to this challenging feat, if you are currently renting a home, you might not feel you have the ability to save very effectively all at once.
If this is the place you find yourself in, then you may want to know how you can still save for a down payment at the same time as you are renting. A good place to start is to look at how much you need to save and then to find ways to save, save, save.
If so, here are some tips to help you learn more about how to save for a down payment while you are also paying rent.
Save Your Tax Refund
If you have been lucky enough to earn a decent tax refund this year, perhaps you can look to save this money and use it towards your down payment. If you are a year away from needing your down payment for example, you can also plan to use the tax refund money you will hopefully receive next year as well. Overall, your tax refund income can be a great way give your savings plan the initial boost it needs.
Save More of Your Paycheque
Another way to go about saving a bit of extra money is to look to save more from each of your paycheques. While you may not be able to save a lot at one time, if you take a small portion of your pay each month, bi-weekly even, and use it towards your down payment, this amount can add up over time.
You may also look into setting up automatic withdrawals to help you save a larger portion of your paycheque. For example, if you set up these withdrawals for a particular amount, $25, $75, $125 even, this extra amount can be taken directly out of your account and transferred into a savings account on a certain day, each month. Again, this money can help you raise the amount you are saving, as well as with more consistency.
Find a Roomie, Save More
If you are currently paying rent on an apartment or home on your own, perhaps it may it might be time to look into getting a roommate. By splitting or at the very least sharing the costs associated with renting, this can allow you to save some additional income towards a down payment. Finding a roomie and sharing these expenses, can perhaps even allow you to save upwards of $1000 or more each month, depending on your current costs of living. This is a great way to free up the extra funds for your savings goals.
Find a Secondary Source of Income and Save
In addition to, or instead of sharing the costs with another person, as well as some of these other tips – you may consider looking at finding a second source of income. Fortunately there are many jobs these days that can be performed as ‘side gigs’ and can supplement your current income without being too overly demanding in terms of taking away from your primary job.
In fact, some jobs can be performed in the evenings, over the phone, as well as many that include online work such as freelance writing, e-learning/tutoring, website design, and so on. All in all, making money online or from other part-time commitments, can also be a resourceful method of earning the additional monthly income you need to save towards your down payment, while also being able to afford your rent.
Save on Your Cable Expenses
Cutting down on some of your current expenses can also be an effective way to start saving a little bit extra from month to month. One specific example of where you can save is by cutting back on your cable services. These days, with Netflix and other online streaming services, you can opt to watch shows and movies for a lot less than you can with cable packages.
In fact, with cable prices constantly on the rise, by reducing your cable services, you could look at saving about $100 dollars or so per month. Instead of paying out all this money to your cable bill, you could instead use this money to save towards your down payment.
When you think about it, there are some creative and unique ways you can look into in order to save some additional money each month. With high costs associated with homes, including renting fees – it really is beneficial to try and save when and where you can.
Over time you can work towards saving up for the down payment,wave goodbye to renter’s life and finally buy that house you’ve been dreaming about.