Owning a home someday is perhaps everyone’s big dream. However, the journey to fulfilling this dream is hectic and long. You have to save amidst ranging bills, budgets, and unplanned economic surges. For this reason, we’re preparing this article to guide you in your homeownership endeavor. Regardless of your income level, you can still own a home. All it takes is discipline, consistency, and planning. The tricks and steps described here come from experience. So, be sure to succeed if you practice them faithfully.

1. Draw the budget

Prior to anything else, the first step should be deciding on the amount of money you need. What the bank offers may be actually different from your actual financial manpower. To get a more accurate figure, calculate your total expenditure including things like car loans and insurances. From this calculation, approximate an amount that you won’t struggle to pay monthly. Normally, a 20% down payment is recommended. Although, this again will depend on the area of residence.

2. Time Frame

So, now that you have approximated the cost, how much time do you have? You need to be pragmatic. Remember you don’t have all the time in this world. Again, you’ve got several other bills to take care of. Therefore, you need to come up with a realistic duration. You can set the saving time to 2 or 3 years depending on your income level and the price of the house. 

3. Pay down your debts

Debts can be a nuisance in your homeownership pursuit. That’s why you need to clear every debt you have before embarking on this journey. Moreover, they can negatively affect your mortgage rate.  Another advantage of paying debts is that it reduces the pressure. Even though this might look counterintuitive, it’s a necessary approach. Furthermore, after clearing your debts, you will have more to save.

4. Determine the best saving method 

You are saving for a definite purpose. For that reason, you need to determine the best saving method. Do not put your money in risky investments like real estate, vehicles, and the likes. Instead, you should save your money in the safest place like the good old savings accounts. You need to be sure you’ll have the funds within your specified timeframe. Therefore, you can’t take chances. Resist the temptations of investing your savings in a risky account. Yes, you may get more money by investing, but again your risk losing the money easily.

5. Include it in your budget

This is a new endeavor. Therefore, you must create room for it in your budget. That means creating a new source of income or cutting down your expenses. Do this in such a way that the whole thing won’t be a mirage. After all, there is no need of creating a plan that will pressure you financially. Plan on how you will cater for this new entrant in your budget. 

6. Automate your savings plan

When money enters our checking accounts, saving it becomes a toll order for most of us. Coming up with a system to deduct the savings directly from the bank makes the process easier, seamless, and invisible. But when it’s automated, you can’t touch it.  So direct your savings to a dedicated bank account or your favorite saving method.

7. Save those windfalls 

Saving the windfalls makes the process easier and can even shorten the period. Windfalls can include funds from bonuses, refunds, gifts, or cashback. You shouldn’t underestimate the power of those few dollars you add to your savings. Saving a thousand bucks isn’t all you need. Even those deposits can go a long way in easing your down payment. 

8. Live frugally

Sacrifice makes things easy although it’s not easy itself. Therefore, to make your plan more achievable, you need to live within your minutes. That includes downsizing your wants. At the end of the day, the additional dollars you get here will contribute to the bigger goal. You can reduce things like cable subscription, recreation, among others.

Conclusion 

Do you have a dream of owning a home but wondering where to start? This article is for you. We have simplified the whole saving plan for you. The ball is in your coat now. And who knows, if you are capable, you might be headed to your home in the next few months. It all comes down to how ready you are to achieve this milestone.

Disclaimer: This is not legal advice. I am not a legal and /or financial advisor or investment advisor. This is a blog post about helping you to manage your money. All information found here, including any ideas, opinions, expressed or implied herein, are for informational, entertainment, or educational purposes only and should not be construed as personal or legal advice or investment advice. While the information provided is believed to be accurate, it may include errors and inaccuracies. To the maximum extent permitted by law, Fixyourbrokenfinance disclaims any and all liability in the event any information, commentary, analysis, opinions, advice, and/or recommendations prove to be inaccurate, incomplete or unreliable or result in any investment or other losses. You should consult with an attorney or other professional to determine what may be best for your individual needs. Your use of the information on the website or materials linked from the website is at your own risk.