Schaeffer’s Investment Research professionals recently discussed how you can start saving for a home.
Purchasing a home is a major goal for many Americans. Unfortunately, for many, it feels like a goal that is out of reach. The experts at Schaeffer’s Investment Research recently explained that owning a home doesn’t have to be a far-fetched idea. They offered several tips on how you can start saving for a house right now.
“The goal is to start saving for a home as soon as you realize a desire to own one,” Schaeffer’s Investment Research professionals said. “It’s easy to underestimate the amount you’ll need for a down payment, as well as the many items you’ll need to purchase along with your home.”
Homeowners should be prepared to pay roughly 2 to 5 percent of the price of the home as a down payment. Closing costs also vary between 2 and 5 percent of the purchase price. Moving expenses can also cost thousands of dollars, especially if you’ll be wanting to make any renovations or purchase new furniture.
“An automatic withdrawal toward your home savings is ideal,” Schaeffer’s Investment Research professional said. “This is one of the easiest ways to guarantee you’re saving for a home, as the money is put into an investment account as soon as you receive your paycheck.”
This automatic withdrawal prevents you from spending extra money from your paycheck on frivolous items that don’t contribute to the purchase of your home. However, experts suggested only setting up this withdrawal after you’ve eliminated payments on credit cards or other high-interest loans you may possess.
“It may not sound incredibly desirable, but sacrificing some space or luxuries now could result in purchasing your home sooner,” Schaeffer’s Investment Research experts said. “Renting a place that is $400 cheaper per month than you’re currently paying can save $4,800 per year. This money can go directly toward your down payment and moving expenses.”
Similarly, investment experts suggested cutting out luxuries. Assess your budget and determine how much you’re spending on expensive clothes, dining at restaurants, and bar tabs. You may be amazed that you could save thousands of dollars per year by cutting out a few luxuries. Budget carefully, and you can put additional money into your home investment or savings account.
“In addition to finding ways to save money, you should be looking for more ways to make money,” experts said. “Picking up a side job or freelance work could result in thousands of additional dollars saved per year. Two people making additional income can result in even more. The concept is simple, the more money you save, the quicker you’ll be able to purchase a home.”
Purchasing a home is not a far-fetched dream, and the experts at Schaeffer’s Investment Research can help.