Saving money can be extremely difficult and never more so than when you are trying to get on the property ladder. This is the biggest hurdle facing first time buyers and with rising house prices and the cost-of-living crisis, it is currently harder than ever to save up the required 10-25% deposit that is now needed to get competitive rates and a wider choice of mortgages.
We asked some professional Romford estate agents to share with us their top tips to help first-time buyers save up for their deposits.
Start Early
When you are young and finally able to enjoy having your own money to spend on what you want, saving can often be the last thing you are thinking about. However, the earlier you start saving the better and if you do so when you are still living at home or don’t have any children or commitments then it can be much easier than you think to set aside a little each month, whilst still having plenty leftover.
Planning
Spending the proper time planning on how, where and how much you will save will have a huge impact on how successful you are. Things that you need to properly look into, research and consider are;
- How Much Of A Deposit Will You Need? There are many great tools and guides online that can help with this.
- Where Will You Put Your Savings? There are options such as ISA’s and different types of savings accounts that could help to give you as many benefits as possible.
- What Is Your Budget? Calculate your incomings and outgoings and use them to come up with a realistic amount that you could save each month.
- What Is Your Timeline? It might be that you are just being proactive and saving for some time in the future or maybe you are keen to be in your first home by a certain date. Using your budget calculations, you should be able to work out roughly how long it would take to save your deposit and if you need to make adjustments.
Outgoings
Being realistic, saving money isn’t going to be fun and if you want to buy your own property then it will mean cutting back, making sacrifices and doing what needs to be done, spending as little as possible and saving as much as you can.
- Rent – Take a look at your current living situation. Are you currently renting? If so, do you have the option to live with your parents in the short term to save some money? Maybe consider a flat share or co-living which could be a great way to cut down rental costs.
- Bills – Phones, utilities and insurance are just some of the outgoings that are worth shopping around for on comparison sites to get the best deal.
- Spending – Clothing, holidays, cars, gym memberships and subscriptions are all expenses that should be either cut down or cut out completely if you are taking saving seriously. Maybe see what other gyms are local to you that offer cheaper rates or choose an off-peak membership, cancel those streaming subscriptions and sacrifice a holiday for the long-term gain.
Make Extra Money
Is there an opportunity anywhere for you to make some extra money?
It might depend on your job and how much spare time you have but there are a number of ways that savvy spenders bolster their income to make saving quicker and easier;
- Take on over time
- Freelance
- Do you have a hobby you could turn into a profit?
- Set up a side business making or selling things
- Sell unwanted items
- Use cashback sites