A home is probably the most significant purchase you’ll ever make, and quite probably the biggest. It’s the place you’ll be spending your time and perhaps raising a family, so you want it to be perfect, but your dream home will probably not come cheap.
Whether you’ve started house hunting or you’ve got your head bogged down in new home designs, you’ll need to get serious about saving money if you want to turn your dream into a reality, so here are 5 practical ways to start saving.
Monitor your Spending
Before you can change your spending habits and start some serious saving, you’ve got to understand how you spend money now. Try keeping a spending journal where you record all your purchases from day to day. This is a great way to uncover any bad habits and unnecessary spending. It will allow you to highlight areas that need improving and determine what spending habits you could do away with to maximise your saving potential.
Plan a Budget
Consider all of your outgoing expenses and what kind of money you’ll need for day-to-day spending based on the information you’ve gathered with your spending journal.
You can then create a budget that will divvy up your total household income. Assign part of your budget to your recurring expenses, like rent, car registration, insurance payments, phone bills etc. Decide how much you’d like to be saving from each pay and try to allow yourself enough money for daily living expenses while still reaching your savings goal. But remember, you must stick to this budget you’ve created or it’s all for nothing.
Cut Down on Expenses
If you’re serious about saving, you’ll probably need to make some sacrifices and cut down on your expenses. Do away with any luxuries that you feel comfortable forfeiting while you’re doing some determined saving. For example, start bringing lunches from home or having home cooked dinners rather than eating out all time, or get rid of that gym membership that you’ve got good intentions to use but never actually do.
Shop for Better Deals
Be more careful about how you’re spending your money by shopping around before making a purchase. It’s a bit of extra effort but every little bit helps when it comes to saving for your dream home. It’s worth doing price comparisons online or calling around to enquire about product pricing before you make purchases.
Another great way to cut down is calling up service providers to whom you pay your bills and haggling for better prices or better deals. For example, you can call up your insurance provider and tell them you’re shopping around for the best price. If you’ve found a better price elsewhere, they may be able to match it or get close, saving you money without having to change providers.
Get Rid of Debt
If you’ve already got existing debts, make it your priority to get rid of them as quickly as possible. If you put in all your efforts to clearing your debts straight up, you’ll be able to save far more effectively once they’ve been paid off. Lump sum payments are a great idea as they reduce the overall interest you’re being charged. The quicker your debts are gone, the quicker you stop throwing your money away on high interest rates.
With these simple and practical steps you’ll be on your way to walking through the front door of your dream home in no time. Be patient, be persistent and be positive, that dream home is right around the corner.