Be Smart with your money
Practical Tips to find the deposit to acquire your home
A deposit is a main factor in the process of home ownership. It reflects your seriousness and ability to start your journey of acquiring a home. A deposit can range between 10 and 15 percent, which is usually provided to the vendor to temporarily secure the unit. Seemingly a humongous task for many, accumulating your deposit may take some time.
Here are some practical tips that you can adopt to alleviate the stress of finding your deposit.
Dedicated Savings Account
Take out a standing order for a specific amount of money to be directly deposited to a specific savings or contractual account. Dedicate at least 20-25 percent of your monthly salary, if you can.
Save and then Spend
Don't spend and then save what's left. At the end of each pay day, save a portion of your money and whatever remains should dictate your spending.
Lower Housing Solutions
If you currently live in a rental, find a cheaper alternative if possible. Scout for a lower-priced unit or explore the option of moving back home to your parents or other family members to eliminate that additional cost.
Don't Extend on Luxury Items
You don't need to update your wardrobe with high end shoes, clothing and accessories every month. Do you even really need that post-paid phone plan that you hardly ever exhaust but will still have to pay for at the end? What about your cable package? Maybe you don't need that package with so many channels or do you even need cable at all.
Don't just buy based on name brands. Look out for the most cost-effective items, with superior quality and usefulness.
Create a Second Income
Tap into your skills and use this to create some form of employment to generate extra cash. If you are a great singer, promote yourself and take up stints at weddings and other special occasions. If you are proficient in a specific subject, become a tutor for students.
Grants from Parents
Your parents could be a major contributor to financing a portion of the deposit. Speak to them to find out how best they can help you financially to meet your target.
No Gifts, Cash Please.
Traditionally gifts have been given to celebrate major accomplishments and celebrations. However, in more recent times, cash gifts have slowly been introduced to replace tangible gift items. For example, bride and grooms are now taking out bridal registries at financial institutions for guests to make direct deposits. The accumulated amount is then used by the couple to suit their preference and one increasingly common action is to put it towards a home deposit.
Stay away from debt
Try to pay off credit card balances and to lessen its use. Hire Purchase and other debt avenues will lessen the amount you can save as you are required to service your loan amounts. Having too much debt can also hinder you from acquiring a mortgage loan.