Creative Ideas to Save for a Down Payment for a Home

SaveMoney_DownPayment.jpgThinking about buying a home but do not have any savings for a down payment? Make a conscientious decision to start saving for that home. Here are some creative ways to save money:

Use Direct Deposit
Have money directly transferred from your pay check into your savings. You will not spend what you do not see in your checking account.

Monitor Daily and Weekly Expenses
Adjusting little spending habits can result in big savings. If you have a habit of buying coffee, lunch or even snacks from the vending machine, consider cutting those expenditures. That $2 (or more) cup of coffee ends up costing $10 in a work week or almost $500 in a year. Lunch out Monday through Friday at $7 is over $1800 in a year. Brown bag lunches will bring in a huge savings towards that down payment.

If you belong to an expensive gym, consider finding a more affordable membership or exercise for free in a park.

Loose Change
An easy way to save money is to empty your wallet weekly of loose change and dollar bills. Keep the money aside and turn it into savings every month or so.

No-Spend Day – A “Spend Diet”
Can you make it 24 hours without spending money? Challenge yourself! And if you are up to it, perhaps schedule several no-spend days throughout the month.

Avoid the ATM
If you tend to be a cash spender, allot yourself an allowance and stick to it. Some people like to take their cash and divide the money into envelopes – grocery, gas, entertainment, etc…

Stop Using Credit Cards
By always paying by credit card, you may lose track of how much you are actually spending. If you do prefer to pay via a credit card, keep a tally of how much you are spending on the side of an envelope that holds all of your receipts.

How Much Is Your Entertainment Costing You
If you monitor your budget, you should be able to easily analyze how much money you spend on entertainment: restaurants, happy hours, movies, concerts, cable television and such. Consider cutting this budget to save money.

Curtail that movie habit and enjoy films on Netflix and save about $500 for the year (two people going to the movies twice a month at $10 per person with no popcorn.) Or, if watching films in the theater is a passion – consider giving up the expensive concessions! Cut the cord with cable – and start saving your money.

If attending live performance theater is important to you, consider saving cash by sitting in less-expensive seats. (If you volunteer to be an usher, you can see performances for free!)

Plan social events that are free. Go hiking in a park with friends. Tour a museum on the free day. Take advantage of free outdoor concerts. Invite friends to socialize at your home and provide your own entertainment – cards, board games or movies. Read more from The Simple Dollar blog article titled 102 things to do on a money-free weekend.

Use the library and read books and enjoy DVDs for free. (Or swap books and DVDs with friends.) Cancel magazine subscriptions. Go to the library to read magazines instead.

Gifts and Windfalls
Giving gifts can add up. Set limits on your budget. Purchase gifts on sale by planning ahead. If you are on the receiving end of a gift (and if it is appropriate) ask for a “house funding” gift in lieu of a sweater or other item.

If you receive a windfall of money (work bonus, tax refund, etc…), be sure to add that unexpected money into your savings.

Avoid Big Purchases
Although you may want a new 50-inch television, if your current TV is in working order, don’t buy it. The same goes for your car. Instead of a luxury hotel for a week of vacation, consider a “stay-cation” and have lots of fun and no hefty hotel bills.

Change Shopping Habits
Be a smart shopper. Do not buy things on impulse. Look for sales and use those coupons. If you are tempted by store email lures, unsubscribe to them. If you have online retail accounts, remove your credit card numbers. Place a sticky note on your credit card that says, “Do I really need this?”

When going shopping, make a list and stick to it. Another way of looking at a purchase is to ask yourself: “How many hours do I have to work to pay for this item?”

If you tend to be a stress spender – find another way to decompress. Do yoga or meditate at home. “Pin” things on Pinterest instead of actually buying them.

A Side Gig! Earn Extra Cash
Consider side jobs to save money. Do you have a hobby or skill for which people are willing to pay? Earn cash by becoming a dog walker – and get exercise while earning money. House sitting is another way to earn money.

Have Stuff?
Sell your unwanted or needed items on Ebay or Craig’s List. Read more about selling unwanted items.

Drive and Make Money
If you have a car that qualifies, you can make money by turning it into a mobile billboard via a car wrap. Or, speaking of cars, become an Uber or Lyft driver!

Move Back Home
If your parents are willing, you may want to consider moving back home in order to save on rent and utilities.

Research Lender Programs
There are programs that offer lower or no down payment on homes. Sometimes these programs involve certain circumstances such as a cap on income or being a first-time buyer. A few programs will require a length of residency in the home in order to have the assisted down payment forgiven. It’s always a good idea to check with your mortgage loan officer to see what programs are available.

By following these creative tips, you should be saving money. In no time, you will have enough funds for the down payment on a home!

 

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