If you have been considering buying a home for any length of time, you probably know you need a down payment. But how to save for that down payment? If you aren’t currently putting money away every month towards a new home, now is the time to re-evaluate your priorities. If you want a home, you need a down payment – there are just no two ways about it. Here are three concrete things to consider.
1. Assess Your Spending
Set aside an hour or so and track every expenditure you made over the last month – from gum to graduate school tuition. Look for patterns. Look for ways to cut spending. Are you using every ounce of that large data plan you pay for? Do you really go the gym enough to justify the $100/month membership? Do you have a $5 a day coffee habit? Perhaps you eat lunch out or order dinner in. Could you reduce, or even eliminate such spending? These types of spending - overpaying for things you don’t use, and overpaying for things you could just as well make at home, can add up to $5,000 to $10,000 a year. With some awareness and self-discipline, you can save up for your down payment just by making some simple life changes.
2. Evaluate Your Stuff
Not interested in making life changes? Or maybe you already have made those changes, but want a down payment faster. Consider selling some of your belongings. From elegant ball gowns, you only wore once, to business suits you won’t fit into anytime soon, consider selling parts of your wardrobe. You may wish to sell directly on the internet. Or you may prefer the convenience of a consignment store. Either way, get rid of what you are not using.
Consider your furniture. Do you have any antiques you don’t love or art that you no longer enjoy? Perhaps you have a second car, a motorcycle, an all-terrain vehicle, or a boat. If getting a down payment is your priority, take some time to review your assets. You might be surprised at how much money you can get by selling some of your items.
3. Consider a Second Job
A second job can increase your down payment fund by leaps and bounds. If you take a second job, consider opening a new savings account and have your check deposited directly into that account. Just a few evenings a week – or an early morning shift, can make an incredible difference in the size of your down payment savings in no time.
If You are Looking for a Home
If you are looking for a home, contact us. We love helping people find the home of their dreams in the Toronto area. If you are unsure whether you are in a position to buy, our team at Re/Max Hallmark Realty, Ltd. are happy to meet with you to discuss your particular needs and wants. Contact us today.