Purchasing a home whether it be your first home or an investment property is both a challenging but extremely rewarding milestone. To help you get started here are a few ways to help you stay on track and reach your end goal.
1. Create a budget and remove any unnecessary expenses
Like all good things saving for a deposit requires both planning and patience. By sitting down and listing your current expenses it will help you visualize and understand how much you actually spend on activities such as groceries, entertainment, bills etc so that you can work on eliminating unnecessary spending. This will also allow you to determine how much you can put aside weekly, fortnightly or monthly towards your deposit and will give you an indication on how long it will take to achieve your goal.
2. Create a savings account and automate your savings
Trust me when I say, you wont miss what you don’t have. Setting up a savings account dedicated to helping you reach your goal will allow you to track your progress. By having an automated deduction into the account from your pay means that you are less likely to stray from your intended path.
3. Minimise your debts and avoid accessing credit
According to ASIC’s credit card debt clock the total credit card debt for Australians is currently in excess of $31 billion and is rising daily (https://www.moneysmart.gov.au/borrowing-and-credit/credit-cards/credit-card-debt-clock). With the average credit card holder roughly paying interest of $700 per annum if their rate is 15-20%. To avoid wasting money on interest you may want to look at doing a balance transfer to cards with lower rates and or consolidating all your debts so that you can repay your debts as quickly as possible. Most importantly do not increase your spending as credit becomes available, as you will be digging yourself a deeper hole to climb out of!
4. De-clutter your life
As more and more people shop online, clearing your home of unused odds and bits has become a whole lot easier. By utilising sites such as eBay, gumtree or online trading posts you may be surprised with the small fortune to be made from the things collecting dust around the house. The best part is that you can do this from the comfort of your couch, just list it then sit back and wait for the cash to roll in. As they say ‘one mans junk is another mans treasure!’.
5. Take Small steps
Nothing that is worthwhile doing is easy, so it’s important to set small tasks that you can achieve quickly to eventually reach your end goal. It is important to celebrate the small things, as they will be your motivation till you reach your goals.