Saving and Budgeting
The time has come for you to start thinking about buying a house but where do you start. It is often overwhelming to think about the amount of money you need before you can even contemplate looking for your ideal home. We are here to help and have produced a simple 3 step guide to help you develop a realistic saving plan.
Step 1: Record what you spend a month
This in its self is a gruelling task as we often spend more than what we think or more than what we would like. This is your chance to be honest with yourself and won’t work unless you can track your expenses. You will need to include things like bills such as water, gas, phone, internet, car insurance, rent, groceries, any clothes shopping, socialising down to every coffee you buy. Rather than think about all of this in one go, track your expenses over the course of a month for accuracy.
Step 2: Setting a budget
Now that you have an idea on your expenses, you can now set a budget. Your budget is designed around your own spending and the whole point of having the budget is so that you don’t over spend. You need to make sure that you are not living above your means i.e. spending more than you earn.
Step 3: Start saving for your house deposit
You have now worked out your expenses and have set your monthly or weekly budget, now you need to look at putting away 10-20% of your income per week/month to a savings account. You’re probably wondering where you will get this percentage from…. Well sorry to be the bearer of unwelcome news but you might now have to make necessary cut backs on unnecessary for example, buy less coffee from the coffee shop, lower your phone bill or internet, plan your meals so you only purchase groceries to make those meals. There are various cut backs you can make but whatever you decide, you need to stick to it. Saving should be an automatic process and not one you have to think about. Set up an automatic transfer from one account to the other to avoid the temptation to over spend.
Whether you are saving weekly or monthly, it is advisable to keep checking your savings account as this will help you stay focused on your end goal of having enough money for your house deposit.
Below is a link to a budgeting document which you may find beneficial.
For more information on the purchasing process please click on the below link