5 Tips on How to Quickly Save for a Home Deposit
If you’ve been thinking about buying a home, the one hurdle that may be stopping you from doing so is the home deposit. A home deposit is the amount of money that you will need to put down in order to buy a home and the amount needed will vary depending on loan type, purchase price and several other factors. Typically, you can expect to pay anywhere from 5% to 10% or more, which can easily add up to a lot of money. While saving for a home deposit in Australia may seem like an overwhelming task, here are 5 tips on how you can quickly save.
- See if you qualify for a First Time Home Owner Grant. The amount you may qualify for depends on the state or territory that you live in, along with other conditions. If you qualify, you will more than likely still need to save towards the home deposit, but it may reduce the amount you would need to save.
- Find a high-interest savings account. While banks aren’t paying the interest rates that they used to, the Internet is a good place to start if you want to find a savings account that pays a better interest rate. Simply search for “online savings account” to get started.
- If you’re currently renting, it’s more than likely your biggest expense and is the number one cost that is preventing you from quickly saving for your home deposit. If possible, staying with family or getting a roommate while you’re saving up will help make it possible to put more money away.
- Consider your family’s transportation needs – if you can manage for a year or two with only one car, you may be able to save thousands if you currently have a large payment every month. Plus, only having one auto will reduce petrol costs, registration and repair bills.
- Get into good financial habits now. Budget your income and expenses every month, while also cutting out any unnecessary expenses. A few dollars for a coffee every morning can add up to several hundred dollars per year or more!
Saving for a home deposit does take time and effective financial planning. However, by thinking outside of the box and knowing what help may be available, you now have a clearer path for meeting your goals.