I recently hosted a webinar where I spoke about saving for a downpayment on a home. One of the hardest things about saving money is getting started. If saving to purchase a home this year, here are my top 5 ways you can cut spending:
#1 Review your reoccurring charges.
If you haven’t watched Netflix, or used that gym membership in over a month, it is time to cancel that subscription service. All those little amounts can add up!
#2 Examine the cost of eating out vs. eating in.
Take a look at your credit and debit spending for an accurate amount. I challenged myself to only eat out and buy coffee once a week for a month. During that month I saved $500! Make a plan on most meals being cooked at home, and cut down to eating out once a week.
#3 Wait to make “that” purchase.
Nonessential purchases, such as new clothing, shoes, a handbag, or the last tech gadget need to be put on hold. Reallocate those nonessential dollars into paying down any debt, to boost your credit score, and to increase the mortgage amount a bank will loan you.
#4 Create a budget where you allocate money to an account that’s locked.
I’ve had a savings account for years, that I cannot access with my debit card. It makes me think twice about spending that hard earned cash. Most online banking options actual have a way for you to allocate certain funds toward specific goals to help you keep on track.
#5 If you’re renting, there’s a way to build your downpayment into your rental payment.
Hear me out on this one. For example, you can spend $2500 + utilities on rent. Take that amount down to $2000, if you can, and put that into a savings account. That’s $500 a month = $6000 per year x 4 years = $24,000 saved towards your home.
Considering buying a home or condo in the next 3-6 months? Contact expert Toronto and Greater Toronto Area based Real Estate Agent Caryn Parchment, to discuss your options.