Realistic Strategies for Saving Money for a Down Payment

Posted by Unity Home Group® on Thursday, June 22nd, 2017 at 5:56am.

How to Realistically Save for a Down PaymentDown payments can be scary, especially for first time home buyers. 20 percent of the home’s total value is the standard for a down payment, with some variations, but even on a $200,000 home, that still comes to a $40,000 down payment. A down payment can seem like a lofty goal, but here are some strategies for buyers to start saving that don’t involve giving up coffee and avocado toast.

Buy Generic and Store Brands

Many large chain stores offer their own store brands as alternatives to name brands. These store brand products are often very similar to their name-brand counterparts, and they’re often far less expensive.

This doesn’t just apply to cookies and paper towels, though. Many over-the-counter medicines, like pain killers and eyedrops, also have store brand alternatives that are just as effective but cost a fraction of what the name brand drugs do.

Use Public Transportation

Not everyone can live in New York City and have access to subways, but most cities have buses where people can buy monthly or yearly passes to save on the fare cost. Taking the bus to work and school can reduce money spent on gas.

But while public transportation can be convenient, it isn’t suited for everything. Keep the car for errands that require transporting a lot of things, such as grocery shopping, and enjoy the feeling of not having to fill the gas tank nearly as often.

Plan Meals Weekly

Taking some time to sit down and plan meals will help reduce the money spent at the grocery store because it cuts out unnecessary buying. Likewise, it also helps reduce waste from food going bad before it can be used, and on top of that, eating at home is often cheaper than eating out.

Additionally, buying soft drinks or alcohol while eating out can easily boost the meal’s bill. Depending on the restaurant, one soft drink can cost up to $3, while one glass of wine can cost half of what an entire bottle would be from a grocery store. Ordering water is free, and those saved dollars can add up quickly.

Check Out the Local Library

Contrary to popular belief, libraries aren’t just for checking out books. These days, libraries have everything from music to video games, all available to borrow for free. Why spend $26 on a hardcover novel when it’s sitting on the shelf at the library at a 100% discount?

Cancel What Isn’t Being Used

Nowadays, there are so many different options for watching television that many people have subscriptions to services like Netflix and Hulu on top their normal cable. If this sounds familiar, think about canceling the ones that don’t get used very often. For internet streaming, this can save around $12 per month, and even more for cutting cable

Shop Around

Finding deals is easy thanks to the internet. Whether shopping for clothes, a new phone, or anything, it’s easy to find online coupons and sales to get the best deal

Pay With Cash

It can be difficult to have an accurate idea of what’s in a bank account after a long day of running errands, but buyers will always know how much money is in their wallet. Paying with cash can give buyers a better idea of exactly how much they spend that just isn’t possible with a credit card

Saving for a down payment may seem daunting, but it doesn’t have to be difficult. On top of regular saving by putting aside money from paychecks, a few simple lifestyle changes can go a long way when it comes to watching those savings grow. 

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