5 Ways to Save for a New Home While Renting
Thinking of owning a place of your own but unsure of how to save while renting? With careful planning and a little creative thinking, it can be done. Wells Fargo, a financial services company, conducted a survey, which showed that 9 out of 10 renters preferred owning a home over renting. If you're like most smart renters, you know how to put your money to work. When your lease is up wouldn’t you like to be able to break your piggy bank for access to the funds you need?
Here are a few tips to get you headed in the right direction:
It hurts just thinking about ditching cable but if it's down to the wire and you have one year or less to save, cutting cable costs could make a huge difference, With cable bills over $100 or more per month with premium channels and sports packages, cutting cable could save you close to $1200 over the course of 12 months.
Tuck Away Your Tax Refund
When we think of tax refunds we think of big TV's, vacation, a new car, or a shopping spree. Stop right there! That huge tax refund could be the biggest way to a lump sum of cash for a down payment and/or closing costs. Make the decision at the start of the year or when you make the commitment to buy a new home so that your mind can be on the same page as your pocket book. You'll be less tempted to make unnecessary purchases with your tax refund because the decision has been made ahead of time.
Keep More of Your Paycheck
When you live pay check to pay check, it seems impossible to save. With direct deposit, employers typically give you the option of depositing funds into multiple accounts. Ever heard someone say, you don't spend what you don't see? That rings true. If you have $25 per pay check automatically deposited into a savings account, you can save an additional $600 over the course of one year. Now, before you go saying how hard it would be because you don't have $25 per pay check to give up, let's do a reality check.
Give Up One Daily Expense
You like Starbucks right? Let's say you buy a tall coffee frappuccino every day at $3.25 a cup. That's $16.25 over a 5 day work week and up to $845 over the course of one year. Holy moly! What's your one thing - lunch, smokes, lottery tickets, snacks? Give up one thing for the short term to achieve your long term goal and wholah, more money in your piggy bank.
Save Your Raise
Lucky you if you managed to pull a descent raise out of your employer's budget. That doesn't mean you have to spend it. Save your raise! Have the amount of your raise deposited or transferred to your savings account each month.
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This has been a quick tip by LandlordBreakup.com, the website for smart renters. If you're a renter who is curious about how you can turn your rent payment into a mortgage payment, check out our home buying course and home ownership plan for renters. Check out the course.