Things to know when you start saving up for your first home deposit

Monday, July 4, 2016, 6:00 AM | Leave Comment

You have certainly had a dream of owning a home, a place where you can possibly raise a family and have a big compound where your children can roam around freely.

This is a dream that will require you to manage your finances accordingly in order to fulfill it. You also can be one of the happy home owners that you know of; it is not unattainable goal.

As you research on the process of buying a home, you will realize that one thing will be emphasized by the landlord or home agent, that is, you pay a deposit on the house.

Depending on the state you are currently residing in, you will be allowed to access certain stamp duty exemptions and grants, but one grant that is common for almost all states is the first home owner’s grant.

However, you should know that, in most cases you will still need more capital to put down as the 10% deposit required for your home.

This figure should not discourage you since there are strategies you can apply in order to meet that figure comfortably.

Here are some of them

  • Save 10% of each payment you receive

    This is a common method of saving up for your home. By simply setting aside 10% of the amount you receive anytime you get paid, and transferring that amount to a savings account of a different bank, you will be able to steadily save up for your house.

    It will be more beneficial to you if the savings account is of a different bank and not your regular one, because it will be harder to access those funds just in case you get tempted to spend those savings on something else.

    This step will not be easy because you will have to sacrifice certain luxuries, which means that you will not be dining in the expensive hotels that you are used to.

  • Do away with the luxuries

    In order to purchase the house you have always dreamed of or be able to purchase that Penthouse for sale in your local neighborhood, you will need to downgrade a little for some time in order to achieve the long term goal you have in mind.

    You will be pleased to see the amount you will have in your savings account, in the long run.

    You should know that you do not have to cut off everything simultaneously and start surviving on the bare minimum, you can just start eliminating one luxury every month, and putting aside the amount saved.

    By the end of the year, you will comfortably accumulate thousands of dollars, by having a smart saving method.

  • Get a job you can do part time

    You will be able to boost your savings by using some of your leisure time to earn another income.

    For example, if you are free in the evenings or even on weekends, you can decide to do a job part time, and even though you can earn just a thousand dollars each month, that amount will accumulate to a substantial figure within a year.

Author Bio

GretKilk is a registered realtor; he is a co-founder of a property development company. He deals with advertising for anyone who has property like a bungalow or a Penthouse for sale. He has also authored a book on management of finances.

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