<\/p>\n
This is the gist of it.<\/p>\n
Read on for details and tips on how to take each step correctly so you can save fast, easy and without starving yourself!<\/p>\n
Making a budget, especially with so many great free apps for budgeting<\/a>,\u00a0 is a simple step but a lot of us tend to overlook it.<\/p>\n Write down your income, and your spouse\u2019s, if applicable.<\/p>\n Then go through your accounts for the last few months and write down all of your expenses.<\/p>\n Include every transaction, from your coffee before work to online purchases.<\/p>\n This gives you a better idea of how much of your income you are spending<\/a> each month.<\/p>\n Once you\u2019ve done this, you\u2019ll see how much cash you have left over.<\/p>\n If it\u2019s not much, then there are a couple of things that you can do.<\/p>\n If after your expenses are deducted from your paycheck you aren\u2019t left with much money, then you\u2019ll need to clear some room in your budget.<\/p>\n Join Smart Panel Now<\/a>\n<\/p>\n<\/div>\n A good way to do this is to cancel some subscriptions and services that aren\u2019t essential. If you are wondering how to save money for a house while renting, then this is a good thing to do, because it helps you to free up some of your cash.<\/p>\n Obviously, you can\u2019t avoid paying for electric!<\/p>\n But there are other services that you can cut out.<\/p>\n Here are a few:<\/p>\n You could save more than $55 a month by cancelling cable, and switching to a streaming service like Netflix<\/a>.<\/p>\n Consider switching to a cheaper cell phone plan<\/a>. Or you could even get one for free. FreedomPop<\/a>, for example offers free cell phone plans. You could save $148 a month.<\/p>\n You could work out at home instead and save yourself $648 a year!<\/p>\n There\u2019s a tool called Trim that will find and cancel unwanted subscriptions for you. It could save you $120 a year! Check out our review of Trim here<\/a>.<\/p>\n Another way to make room in your budget is to curb your spending.<\/p>\n There are a few ways that you can do this:<\/p>\n According to federal data<\/a>, the price of food at home decreased, but restaurant prices increased<\/a> by an average of 2.7%.<\/p>\n So, eating at home<\/a> instead could save you a lot of money.<\/p>\n Even if you spend just $10 on lunch each workday, that\u2019s still $50 a week, around $200 a month, and $2,400 a year!<\/p>\n When you add it up, you can see that you\u2019re spending a pretty substantial amount each year. Bring your lunch to work instead.<\/p>\n Or even just cut lunch spending in half.<\/p>\n Never go to the store without a shopping list. According to studies<\/a>, when you take a shopping list with you to the store, you spend less!<\/p>\n This is because having a list means you\u2019re less likely to spend money on impulse purchases.<\/p>\n And with so many great free money saving shopping apps<\/a> that let you create shopping lists easily and on the go, you have no excuse not to do it.<\/p>\n When trying to save money getting stuff at a discount is great but only if you actually need the stuff!<\/p>\n If you buy a $50 item that\u2019s on sale for $30 and you didn\u2019t really need the item, then that\u2019s $30 spent rather than $20 saved.<\/p>\n You\u2019ll save more money by not buying the item at all.<\/p>\n Don\u2019t buy an item just because it\u2019s on sale. Of course, if you were planning on buying something and it goes on sale, then definitely take advantage of the saving.<\/p>\n Take the exact amount of cash you plan to spend with you when you go to the store and leave your credit and debit cards at home.<\/p>\n When you have to physically part with cash, it makes you more aware of how much you\u2019re spending. Plus, when you only have a set amount of cash with you, even if you are tempted to buy extra stuff, you won\u2019t be able to, as you don\u2019t have any cards with you.<\/p>\n This is one of the best online shopping hacks<\/a> to save money. Do not store your card information on online stores.<\/p>\n When your credit or debit card numbers are saved on a website, you can make a purchase with just a few clicks.<\/p>\n If you are trying to save money, then you want to avoid anything that makes spending easier.<\/p>\n So delete your credit card information from retailer\u2019s websites.<\/p>\n Having to actually enter your card details gives you more time to consider a purchase, and think about how spending will impact your saving goal.<\/p>\n This is a simple tip that will stop you spending as much cash.<\/p>\n According to studies, people spend up to 100% more with a credit card<\/a> than they do when they use cash!<\/p>\n If you want to have more money to put towards a house you should avoid using credit cards.<\/p>\n They encourage overspending and get you into debt.<\/p>\n With a credit card, it\u2019s easy to buy an item and worry about paying for it next month when your paycheck comes in, but then you may not have the cash to clear your balance and you\u2019ll get into debt.<\/p>\n And you don\u2019t need more debt on top of your mortgage.<\/p>\n If you do need to buy stuff, make sure that you get the best deals on your purchases.<\/p>\n Compare prices, and shop through cashback websites.<\/p>\n With cashback websites like Ebates<\/a>, TopCashBack<\/a> and Mr. Rebates<\/a>, you can save up to 40% on everything you purchase!<\/p>\n Comparing prices on everything you purchase also ensures that you get the best deals on the stuff that you do by, and it reduces the amount you spend.<\/p>\n There are tools out there that you can use to compare prices too. View our list of best price comparison apps<\/a>.<\/p>\n With Gasbuddy, a gas price comparison app<\/a>, for example, you can save $340 or more a year.<\/p>\n Comparing prices and using cashback websites can save you money that you can put into your home fund.<\/p>\n If you\u2019re wondering how to save money after buying a house these are good tips to keep in mind too!<\/p>\n If you have money tied up in debts, like credit cards, student loans or car payments, then it limits the amount of money you can put toward a mortgage.<\/p>\n So, consider paying down some of your debt first. Not only will this put you in a better financial situation, but it will also free up hundreds or even thousands of dollars to put towards your down payment.<\/p>\n And this allows you to save for a house faster.<\/p>\n Plus, paying down debt can boost your credit score, and lower our debt-to-income ratio \u2013 and since these are important factors that lenders consider when deciding whether you qualify for a loan, paying off debt<\/a> can actually improve your chances of getting a mortgage.<\/p>\n While having a savings goal is great, life happens and there are unforeseen costs that arise. These could be major car repairs, vet bills, or uncovered medical expenses.<\/p>\n This is why it\u2019s important to have an emergency fund.<\/p>\n Then, when an unforeseen expense does arise, you\u2019ll have some cash to cover it, and it won\u2019t affect your goal of saving for a home too much.<\/p>\n Before you start saving for a down payment, we\u2019d recommend setting up an emergency fund.<\/p>\n Once you have your budget figured out, you need to determine how much you can afford to pay on your mortgage each month.<\/p>\n While everyone\u2019s financial situation is different, as a rule of thumb, you should spend no more than 25% of your monthly take-home pay on your mortgage payment.<\/p>\n This is because you don\u2019t want too much of your income tied up in mortgage payments.<\/p>\n If more than 25% of your income goes toward paying your mortgage payment, you\u2019re going to leave yourself short on cash to pay for other expenses.<\/p>\n Here\u2019s an example to illustrate:<\/strong><\/p>\n Let\u2019s say that you earn $3,700 a month.<\/p>\n In your case, you would have $925 a month to put towards mortgage payment. Bear in mind that this number needs to include other costs, like escrow, homeowner association fees, insurance, and taxes.<\/p>\n So take your income, and your spouse\u2019s, if applicable, and then take 25% percent of that, and that\u2019s how much you can afford to pay for your mortgage payment<\/a>.<\/p>\n An easy way to do this is to just multiply your income by .25.<\/p>\n Then, you\u2019ll have your monthly mortgage amount.<\/p>\n Once you know the amount you have to spend on your mortgage each month, you need to use this monthly mortgage payment figure to work out a total mortgage amount.<\/p>\n Now, for this, we\u2019d recommend using a mortgage calculator.<\/p>\n This just makes the process a little easier.<\/p>\n Dave Ramsey\u2019s Mortgage Calculator is a good one (you can use it here<\/a>), and we\u2019re going to use it for our examples below. But feel free to use any mortgage calculator that you want to.<\/p>\n With this calculator, you can select which type of mortgage you want, including<\/p>\n It\u2019s really up to you which type of mortgage you choose.<\/p>\n Obviously, a 15-year fixed rate mortgage will save you thousands of dollars compared to the traditional 30-year option.<\/p>\n So, if you can go with a 15-year fixed rate mortgage.<\/p>\n Of course, this just isn\u2019t possible for everyone.<\/p>\n So choose the option from the dropdown menu that best suits you.<\/p>\n You can enter numbers and see what house you can afford.<\/p>\n Let\u2019s say that you have $1,500 to put towards mortgage payments.<\/p>\n With a set interests rate of 3.66% (which is what the calculator is set to), then, you could afford a home with a value of $210,000 with a 20% down payment.<\/p>\n This would cost $1,477 a month.<\/p>\n Going back to the example above, where the person\u2019s income was $3,700 a month, it would leave $925 for monthly mortgage payments.<\/p>\n In this case, you would have to go with a lower-value home.<\/p>\n You can get a $127,000 home on a 15-year fixed mortgage with a 20% down payment, and at an interest rate of 3.66%.<\/p>\n Or, you could get a home with a higher value, but you would have to pay it off over a longer period.<\/p>\n For example, you could get a $175,000 home on a 30-year fixed rate mortgage with a 20% down payment, and at an interest rate of 3.66%, and your monthly mortgage payment would be $926.<\/p>\n Also, the amount of money you pay in the down payment will also affect how much you pay each month.<\/p>\n Paying 20% will make your monthly mortgage payment less than if you paid just 10%, and 30% would reduce the monthly payment even more, and so on.<\/p>\n It\u2019s really up to you which type of mortgage and home value you want to go with.<\/p>\n Input different numbers into the mortgage calculator until you get your ideal monthly payment that you figured out previously.<\/p>\n So, like we said above, if you earned $3,777, then you\u2019d have $925 a month for mortgage payments. So enter numbers until you come up with a monthly payment that matches this.<\/p>\n Wondering how much money should you save to buy a house?<\/p>\n This is a common question that people have when saving up for a new home.<\/p>\n It\u2019s a good idea to save between 10% and 20% of the home\u2019s value for your down payment.<\/p>\n If you can, try to save 20% because it could lower your interest rate, open up opportunities for a 15-year mortgage, and also help you to avoid private mortgage insurance (PMI)<\/p>\n Let\u2019s say that you are going to purchase a home for $150,000<\/p>\n Then you would need to save $30,000 for your down payment.<\/p>\n This is your saving goal.<\/p>\n It\u2019s not just the down payment that you need to save for.<\/p>\n Banks also require you to pay for other fees.<\/p>\n It\u2019s really important to save for these items too.<\/p>\n Here are some other costs to consider when saving for a down payment:<\/p>\n This is a fee that\u2019s added on to your monthly mortgage. It\u2019s added if you put down less than 20% on your home.<\/p>\n This fee varies. Generally speaking though, PMI will increase your monthly payment by around $50 for every $100,000 spent on a home.<\/p>\n You will need to get your future home appraised and inspected in order to get the lender to sign off on your mortgage.<\/p>\n On average, each of these costs around $300.<\/p>\n Occasionally, the seller may agree to cover closing costs, but don\u2019t depend on it. If the seller does agree to pay the closing costs, you then have some extra cash leftover when you move to your new home<\/a>, which is great!<\/p>\n Getting the mortgage signed off takes a lot of work, and you\u2019ll need to pay closing fees.<\/p>\n These are usually between 2% and 5% of the total mortgage value.<\/p>\n Be sure to add all of the costs above onto your down payment.<\/p>\n This will give you your full savings goal.<\/p>\n Let\u2019s say that your down payment is $30,000, and all of the costs above total around $6,000.<\/p>\n Then your initial savings goal would be $36,000.<\/p>\n Now that you have your savings goal \u2013 we know it takes a lot of calculations! \u2013 it\u2019s time to set a timeframe.<\/p>\n Decide on when you plan to purchase a home.<\/p>\n Then, take your savings goal and divide it by the number of years you plan to save for.<\/p>\n For example, if you plan to purchase a home in five years, and your savings goal is $36,000, then you\u2019d need to save $7,200 a year and $600 a month.<\/p>\n $36,000 seems like a lot, but breaking your goal down makes it seem more realistic.<\/p>\n We\u2019d recommend not giving yourself too lofty a goal.<\/p>\n Trying to save $2,000 a month when you only have $1,000 left over after bills is obviously not a great plan.<\/p>\n Figure out a timeframe that works for you and fits in with your budget.<\/p>\n A common question people have when saving for a home is, \u201cwhere should I keep my money while saving for a house?\u201d<\/em><\/p>\n It\u2019s a good idea to open up a separate account to store your savings.<\/p>\n If your savings are in with your regular account, then the temptation to spend the cash is there.<\/p>\n So, set up another account.<\/p>\n And, consider automating the savings process as well. Set up payments to be taken from your paycheck<\/a>, just as you would with a utility bill.<\/p>\n Then, you don\u2019t even have to think about saving money, as the money moves from your paycheck to your dedicated savings account automatically.<\/p>\n If you\u2019ve been wondering how to save for a down payment on a house fast, then consider picking up a side gig.<\/p>\n This is especially great for people who wanna save money for a house in 6 months or so. You have to increase your income simultaneously while decreasing your spending.<\/p>\n You could get extra cash<\/a> to put into your down payment savings fund.<\/p>\n Plus, it\u2019s also a good idea to pick up some extra work if your budget is tight.<\/p>\n If after looking at your budget, you find that your income is similar to your expenses, even after you\u2019ve cut back, then you may need to increase your income<\/a>.<\/p>\n If your bills alone are close to your income, even without recreational spending, then it\u2019s going to be tough to save for a house.<\/p>\n This is where side gigs can be good.<\/p>\n You can pick up a side gig and put the extra cash into your home savings fund.<\/p>\n Here are some examples of what you could earn:<\/p>\n There are plenty of jobs you can do from home, which is great.<\/p>\n Check out these posts for some paid opportunities:<\/strong><\/p>\n Also, you could do some smaller tasks to make cash, such as:<\/p>\n Saving money for a house does take quite a lot of planning. But if you take the time to plan out a budget and make a savings plan, and take a few extra steps to free up more of your income, buying a home will be a lot easier!<\/p>\n Hopefully, you\u2019ll put these tips into use and save enough money to buy your first (or second, third\u2026) house quickly.<\/p>\n Also if you have any tips of your own, let us know in the comments section below!<\/p>\n<\/div>\n\n
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\nJoin Smart Panel and share your experince on how you use the internet. They pay you $5 for installing their free app & $5 a month just for keeping it, plus loyalty bonus every three months! .<\/p>\nCancel the Cable<\/h4>\n
Switch to a Low-Cost or Free Cell Phone Plan<\/h4>\n
Cancel Your Gym Membership<\/h4>\n
Cancel Unwanted Subscriptions<\/h4>\n
Step 3: Curb Spending<\/h2>\n
Eat At Home Instead<\/h4>\n
Always Use a Shopping List<\/h4>\n
Don\u2019t Buy Sale Items Just for the Sake of It<\/h4>\n
Use Cash Instead of Cards<\/h4>\n
Delete Credit Card Information from Online Stores<\/h4>\n
Don\u2019t Use Credit Cards<\/h4>\n
When You Do Spend Money, Be Smart About It<\/h4>\n
Step 4: Pay Debts Before Purchasing a House<\/h2>\n
Step 5: Set Up an Emergency Fund<\/h2>\n
Step 6: Calculate How Much You Can Afford to Pay Monthly<\/h2>\n
Step 7: Determine Your Total Mortgage Amount<\/h2>\n
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Step 8: Save 10% to 20% for the Down Payment<\/h2>\n
Step 9: Save for Other Costs<\/h2>\n
Private Mortgage Insurance (PMI)<\/h4>\n
Appraisal And Inspection Fees<\/h4>\n
Closing Costs<\/h4>\n
Step 10: Give Yourself a Timeframe for Saving<\/h2>\n
Step 11: Know Where to Keep Your Money While Saving for a House<\/h2>\n
Step 12: Pick Up a Side Gig to Earn More Money<\/h2>\n
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Final Thoughts<\/h2>\n