- 8 financial tips and lifestyle changes that will have a big impact on your future and making progress to snapping up that dream home nice and easy.
- Financial: Emergency fund; Separate savings account; researching to get the best interest rates for your savings; Pay off your debts; Budgeting realistically (what are your non-negotiables); re-budgeting.
- Lifestyle: Review and cancel subscriptions; Shop Savvy.
8 tips to save your house deposit while renting (without giving up your favourite things) 🏠
Buying a house can seem like an intimidating, or even unattainable goal, especially if you’re already forking out weekly for rent 😖. But there are ways you can tweak your budget and lifestyle to make that goal a reality (and no, we’re not going to tell you skipping the avo toast or daily coffee run is the secret to saving up for your dream home).
Before we kick things off, we know saving for a deposit is only part of the equation, but you might be surprised about what options are available to you. Check out our rent convertor before you finish this article. You’ll get a handy overview of houses for sale at a similar mortgage repayment to your current rent.
So, now that you’ve seen the options within your reach, here are 8 ways you can make small changes in your daily life that will have big impacts on your future.
1. Emergency fund 🚨
Starting an emergency fund is a great way to safeguard against going off budget when unexpected costs pop up. Putting a portion of your monthly income into an emergency savings account means your savings goals won’t get hijacked if unplanned expenses pop up. Like when your tire blows out in the same week your dishwasher floods the kitchen 😳…
2. Separate savings account
Creating a dedicated “house deposit” savings account helps separate your house deposit savings and creates a barrier to prevent withdrawals. Separating your savings means there’s no risk of dipping a little too deep when making other purchases (or impulse buying flights for a weekend away ✈️). Removing the risk of withdrawals also means you will likely qualify for bonus interest rates in your savings account. Woohoo! 💵
3. Interest rates in savings accounts 📈
It is always worth shopping around both within your current bank, and at other banks or credit unions to see which accounts offer the highest interest rates with little to no strings attached. Consistently depositing money without making withdrawals will qualify you for bonus interest rates in many savings accounts. The difference between 2% and 4.5% may not see like much, but compounded over months, it can make a big difference.
4. Pay off your debts 💳
Paying off any debts should be a priority when saving for a house. The longer you’re paying off a loan, the amount of interest will only increase. Plus, keep in mind that debts can affect your credit score which could cause roadblocks when applying for a home loan. Decide on an achievable amount to be paying off weekly, and make it a non-negotiable in your budget
5. Figure out your non-negotiables
Budgeting realistically will be the make or break for saving. Whilst it’s important to understand what your necessary purchases are, it’s also unrealistic to give up all the little joys (like your Saturday morning latte ☕️) until you’ve bought a house. Figure out what you really don’t want to live without and factor this into your budget. 🙅♀️
6. Cancel subscriptions 📺
When was the last time you actually checked your subscriptions? We live in a time where we are spoilt with choice, and subscriptions definitely fall into this first world problem. With access to endless services and entertainment, it’s easy to get swept up and forget about those direct debits coming out each month. It’s time to do a subscription audit! Could you be sharing your Netflix account with your housemates to cut down on the cost? Many subscriptions offer student or ‘family’ discounts, check out what’s available to you. Narrow down your subscriptions to the ones you can’t live without, and cancel the rest.
7. Shop Savvy
With the cost of living on the rise, our increasing grocery bills have been on everyone’s minds. To work these costs in with your budget, start getting savvy with your weekly shops. Looking in catalogues for the weekly sales show where your necessary items may be on sale or cheaper! 🛒 Utilising services like click and collect will also limit the opportunity to reach for those extra temptations in store. Completing your shops online also provides some great rewards deals with chains like Woolies and Coles, so you can rack up points and limited online offers.
8. Rebudget 📊
Now you’ve made a few changes in spending and saving habits, it’s a great time to re-budget. If you’re looking for an easy-to-use and free budget template, we’ve got you covered. Download our budgeting template. Use this to map out spending in line with your pay cycle (weekly, fortnightly, monthly) so you can easily track money going in and out. This restructure will provide a clear plan for how your new spending and saving will help you move towards your goal faster. It’s good to get into the habit of reviewing your budget every 3 months. Cost of goods and services can change quickly, so your budget may need to adapt.
So, if you were looking for that sign to start saving for a home loan, here it is. With these small changes, you can start making progress to snapping up that dream home 🏡.