3 tips to save your first home deposit faster
Slapping on that sold sticker could be here quicker than you think!
We want to give you some easy to achieve money-saving tips, because we know first-hand the benefits of getting into the property market sooner rather than later. The only thing standing in your way is that pesky deposit… so let’s get saving!
Learning to save is one of the most important life lessons (which hasn’t quite made the school curriculum yet…. Shout out to those super useful Algebra lessons!). Don’t stress if you’ve found it hard to save in the past, it’s a difficult thing for many people regardless of age or income. Hopefully, by the end of this article, you’ll be on your way to financial freedom!
Make a budget
This is essential, but there are a few ways to do this. There are some great apps around for example; MoneySmart, or you could go old school and write everything down in excel, or go real dark ages and get yourself a pen and paper. However, you go about it, knowing your cash flow is crucial. The more we are aware of where we spend our money the smarter we can be with it.
1. Work out how much money comes in, aka your income, and how much definitely goes out, aka your non-negotiable expenses. (FYI Netflix is not a non-negotiable. Here we’re talking about your rent, insurances, car expenses, etc). Find out how much is leftover from that then work out what you want to save and how much you want to be left over for the fun stuff. Ie going out, Netflix, activities, holidays etc.
2. The barefoot method. If you haven’t heard of Scott Pape, then look him up. I personally know friends and family who have used his savings method and saved a house deposit in a year. No joke! He explains you should live off 60% of your income and explains how you should divide your income into buckets – Blow (smile, splurge, and fire extinguisher) / Mojo / Grow. Read his article here to find out more.
(no affiliation to him, just seen people achieve amazing results after following this method).
A few additional mentions:
1. Contact your employer and get them to send part of your pay to an account which you can’t access everyday which your non-negotiable expenses get drawn from and your savings accumulate.
2. Avoid late fees by setting up direct debits.
3. Negotiate everything. Call up your insurance company and see if they can give you a better deal. Car on finance? Shop around! Energy bills. Again shop around or call your current provider and see if they can do better.
Make extra money
Here are some easy steps to get some more cash in the bank:
1. Sell things around your home you no longer need. Clothes/electronics, the lot
2. Rent out your car via Car Next Door or GoGet
3. Participate in focus groups or become a mystery shopper
4. Look on Airtasker for work
5. Consider pet sitting
6. Are you a creative or digital nomad? Check out work opportunities on ‘Up Work’
7. Become an Uber driver
8. Make stuff and sell it on Etsy
9. Consider becoming a Nanny
10. Super smart? Consider tutoring and advertise on your local community Facebook group
Have a goal
Lots of people just say I need to save a deposit and start saving. Setting specific savings goals will help you to begin saving money. When you are just putting money into the bank on a regular basis, it can be easier to withdraw it for various reasons. We think it’s better to say, ‘I want to save $50k in 18months’, and then break that goal down on a monthly basis. It makes it specific, measurable and time bound. Track your savings and make sure you are achieving the savings goals you set. Don’t stress if you need to reset or adjust. An important factor is to make sure the goal is realistic, so you stick to it.
Good luck! We believe in you!
Tabitha