If you want to purchase a home, you may be impatient to get started. However, buying a home is not as simple as it sounds, and most conventional loans require a down payment of 20%. This can be a lot of money, and some homeowners might be wondering how in the world they can come up with that kind of cash. Whether your household income is $40,000 a year or $100,000 a year, here are seven tips for saving up for a down payment.
Figure Out How Much You Will Need
In order to save up for a down payment, you first need to figure out how much you will need. The answer will be based on the type of loan you are trying to get (some loans require as little as 3% for a down payment, while others require 20%). You will also need to figure out the price range of homes that you can afford in order to figure out how much a down payment will be.
Earn Cash on the Side
It can be easier than you think to earn a little extra cash on the side. Whether you choose to mow lawns or babysit on the weekends, you can figure out things to do that will help you put some money away.
Keep Your Goal in Mind
In order to keep yourself motivated, try printing out a picture of your dream home and placing it on your refrigerator. If you keep your goal in mind, you will have an easier time making tough budgetary choices that will help you reach your goal more quickly.
Establish a Budget
It is very important to establish a strict budget that will allow you to put a little extra money aside each month for your down payment.
You have undoubtedly seen advertisements or shows about people who use extreme couponing to save thousands of dollars a year. Most people do not have that kind of time, but you can still save some money by taking a few coupons with you to the grocery store.
Celebrate Small Achievements
If you celebrate your small money-saving achievements, you will be more likely to stick with a savings plan.
Have Date Night at Home
Instead of going out to eat every weekend, try cooking more date night meals at home. Not only will you save money, but it can also be fun to cook with your significant other.
Saving up for a down payment can be difficult, but it is not impossible. If you try some of these helpful tips, you will be on your way to putting a down payment on a home in no time.