How to save for a deposit in three steps
A dream for both young couples and professionals, buying a home is a major life event requiring significant time and financial investment. Regardless of your ideal location or property size, saving for your deposit will always involve an extensive amount of money which in the recent economic environment, is an increasingly challenging obstacle to overcome. A key won't make it through the door without a well-disciplined savings strategy rolled into action.
Let WhatHouse.co.uk offer you the best chance of hitting your savings target with everyday hints and tips, ensuring that your savings come dripping in slowly but surely.
1. Prioritise, don't sacrifice
It's not rocket science that saving for a mortgage will involve cutting out a few extras here and there. But fret not, unless a lifestyle change for the better (do you really need that extra drink at the pub on a Friday night?) completely changing your normal routine is not necessary.
Saving for a deposit may take several years so it is best to prioritise life's essentials early on and make some subtle changes along the way.
Try making these suggested changes to see how things start adding up-
Switch supermarkets for one with more pocket-friendly prices
Leave the car at home. Try car sharing, public transport, or take the green option and cycle or walk to work where possible
Limit the number of nights out. If you really can't live without letting your hair down, go to places with promotions and deals you can't afford to miss
Save on a gym membership by getting out in the fresh air. Run, walk or take part in a team sport
Show off your culinary skills by inviting friends round instead of going for pricey meals out
Picking up a sandwich every lunch time? Try bringing your own packed lunch instead
2. Make your savings work for you
Once you've decided on the house and location you'd like to buy, you'll have a figure to save towards - an average of 10% of the asking price. There are useful tools out there such as The Money Calculator's House Deposit Calculator, which takes the hassle out of calculating how much and how long you need to save for.
To make your savings go further, find the best account for your needs. Cash ISAs are normally are ideal. Look for an account with the highest short-term interest rates which provide easy access to your funds. Don't forget to regularly review the market to make sure you are getting the best deal.
You may also find it useful to set up regular payments to transfer your savings every month, making sure you don't forget or overspend. It will also teach you to budget your remaining funds. To boost your finances further, consider getting a part time or weekend job, or find a new home for your unwanted goods by selling them on eBay and make some money at the same time.
3. Patience is a virtue
Last but not least, be patient and flexible. Unless you come across a windfall finding your deposit isn't going to happen overnight.
The housing market is prone to fluctuation so keep a regular check on how things are performing. You don't want to reach your target only to find prices have increased, leaving you short of where you want to be.
When you are ready to make the move, WhatHouse.co.uk has hundreds of new homes, in convenient locations. Why don't you take a look and start planning your future today.