Saving for a down payment for a house can be a stressful and challenging process. Don’t let the hurdles of a down payment discourage you from home ownership. The tips below can help with achieving your down payment goals and reducing the stress of an initial down payment for your new home!
- Develop a budget for your down payment – How much do you want to save for a down payment? 5%...10%...20%? Any level is achievable with a budget and savings plan. Remember — the more your down payment is, the less you’ll owe per month on your mortgage and the less you’ll pay in interest over the life of the loan!
- Develop a savings plan and stick to the plan – Develop a monthly budget and determine how much you want to save per day/week/month for your down payment. There is no right or wrong answer here, just remember the more you can save, the quicker you can achieve your down payment goal!
- Separate your down payment from your spending accounts – This can be easily achieved with a separate savings or money market account. This practice can help separate your living expenses from your down payment savings. These types of accounts won’t provide substantial earnings but you will earn interest and the value will not go down, compared to the risk of putting the excess funds in investments.
These basic savings tips can help lead you down the path to home ownership and financial peace of mind during the process!