Do you want to buy a house in NYC or the surrounding areas? If so, you will want to start saving your money right away! There are many benefits to having a large down payment or buying a house in cash. In addition to those costs, you will have moving, decorating, utility, and furnishing costs. Paying for everything is simple when you plan ahead and save up for these things in advance! Check out our savings strategies for home buyers in our latest post!
Set Up A Separate Bank Account
In order to really save your money, you want to put it in a place where you can’t as easily access it. Adding to your everyday accounts blurs the line of what you are really saving and makes it much easier to tap into those funds for other purchases. By keeping a separate account, you can set up automatic deposits, treat your savings account as a monthly “expense” and be able to really watch your money grow. Seeing the number rise in this special savings account will give you even more incentive to save, save, save.
Use A Spending App
Many people think they have a good idea of what they are spending and where each month. However, if they were to really dive into the numbers, they might be shocked at what they are really spending. The morning coffees, afternoon smoothies and quick lunches on the road really add up. You might find your grocery bill is in check, 0but you are spending hundreds on eating elsewhere. Having an app to track your spending will help you have a better perspective of where your money is going and where you can find places to cut back. Mint and Wallaby are popular options to help you track spending and maximize credit card rewards.
Are there some old baseball cards or Barbie dolls laying around in your attic? You might have something valuable just sitting around that you can turn into cash for your new house. It isn’t worth it to sell something you are attached to. However, if it’s not something you will miss, it could be a great way to bump up that savings account.
Save All Windfalls
Any out of the ordinary, unexpected cash you receive should go right into savings. If you weren’t expecting it in the first place, then what’s the difference right? If you receive a bonus from work, a tax return, or $20 from your Grandma who still insists on giving you money for your birthday each year… put those funds directly toward your savings.
Things To Keep In Mind
- An FHA loan requires as little as 3.5% down. This would only be $7000 for a $200,000 home. Of course, it will depend on your income and your other financial obligations, but many people are able to save up this amount relatively quickly when they put an action plan together using some of the steps above.
- Remember you are trying to save money, not deprive yourself completely. You don’t have to live on milk and bread or have your kids sit home all summer. Try to strike the right balance. Cut out things that aren’t essential, but still allow yourself to get a coffee once and awhile or go to the movies. Whatever floats your boat.
- Don’t use all of your money for the downpayment, there will be other expenses. Many people will save up 10k, use it for a downpayment, then realize they need to buy several new appliances. Or that their furniture doesn’t fit in the bedroom. Or that the electrical bill is much higher than they are used to. You get the point Save up for the entire move, not just the downpayment.