Buying your first home will be one of the greatest feelings of your life, finally getting your hands on the keys to your own space fills thousands of Brits with immense pride every year.
However, saving for your first deposit to get that important first step on the property ladder can seem unachievable and fill you with dread.
Saving can seem almost impossible, especially with an average deposit of 15% of the cost of the property.
Fortunately, the financial experts at Online Mortgage Advisor are here to help you with their best advice to speed up the process of saving for your first home.
They revealed seven top tips to make sure you’re on the right track to saving the amount you need as quickly as possible.
Reduce your rent as much as possible
Saving for a deposit while paying rent may seem like a huge task, but you could reduce the cost of your rent by switching to a house / share. This will free up more of your monthly income and you can set it aside for your home deposit.
Set aside your savings as soon as you get paid
It’s a piece of advice that everyone is always willing to offer, but it really works. Placing your deposit money in a savings account as soon as you get paid will prevent you from overspending each month and ensure you stay on track with the amount you want to save after each payday.
Don’t start saving with unrealistic expectations
In reality, you are not going to have thousands upon thousands of pounds in a savings account ready to be deposited within a year. It takes time to save for a deposit, so don’t despair if you don’t get the amount as quickly as you hoped to start, or if you need to miss your monthly savings goal. You will get there in time!
Open a Lifetime ISA
The 25% bonus that comes with a LISA can be a big help when it comes to buying your first home. As long as you’ve had your LISA for over a year, you can cash it in as a first-time buyer, provided you buy the property with a mortgage and it costs less than £ 450,000.
While this may not be an option for some people, a great way to cut costs and free up more money so you can set aside a deposit is to come home with family or even friends. Just make sure you have a conversation about rent, housework, and space before you move back to make sure everyone is happy with the situation.
Buy part of a property
While this is technically not a faster way to save, it does allow you to reduce the amount you need to save. Shared ownership and equity regimes involve buying part of a property and renting out the rest. Although you might not own 100% of the property right away, you would have one foot on the property ladder. You would still need a deposit, but you would only need to borrow 25%, 50% or 75% of the value of the property, rather than borrowing 90% or more.
Eliminate unnecessary costs
While we all love a take out coffee and a meal offering, it can quickly add up. Take the money you spend every day and put it in your savings account. It will certainly shock you at how quickly your savings account will grow.
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This notice was published: 2021-07-23 23:00:00