Deposit for a home loan – what you need to know
Just as they say in cricket, every run counts, think of finance as no different. Every dollar, in fact cent, counts. The more you save, save and save, the easier you will find securing as well as repaying your home loan!
When you have decided you want to save up for a home loan, the first thing you would ideally want to do is to start budgeting without compromise. You will want to list all your monthly expenses. These should include any existing debt repayments, savings towards a deposit, bills, and petty cash for unforeseeable expenses.
The Federal Government’s www.moneysmart.gov.au is a great place to start if you are looking to enhance your financial skills without conducting formal study in the field!
In truth, there is no magic recipe for saving up money for a home loan, but it is always the small things one needs to be mindful of.
Always make sure that you look at your bank and credit card fees because these can be quite expensive if you don’t read the small print. Reducing any expensive debt and making sure you have the right account for you is crucial. The more you limit the use of your credit card, the better.
When monitoring your vehicle finances, make sure you are on top of any and all associated expenses such as on-going renewal fee for roadside assistance, annual registration fees, regular car servicing costs or any other kind of insurance you might have. The better you manage your motor vehicle the less you will spend on maintenance, and in effect, more towards your home loan deposit!
As far as personal habits are concerned, drinking excessively and smoking cigarettes are possibly the worst habits if you are saving up for a home loan. Not only are cigarettes a total waste of money, they increase your risk of heart and lung disease!
Be mindful of where you go shopping. Have a look around at your purchases each month and search for ways to keep the costs of your items to a minimum. Until you have saved up the amount you are looking for towards your mortgage deposit, it would be well worth your while trying to limit yourself to shopping at more affordable outlets, rather than the extravagant ones we all dream of shopping at.
Isolate your needs from your wants. We’re all too good at presuming our wants to be needs. If you actually gave this a serious thought you’d be surprised how many of our purchases we frequently mistake as being important when in actual fact they are luxuries we can easily survive without.
Really, budgeting and saving up for a home loan is a gradual process and one has to reflect on how things are plodding along on a regular basis. Obviously keeping accurate records of where things are at will help and remember, the most important thing about saving up for a home loan is to make sure you are able to save up as great a percentage of the total property value as is possible for you. Large home deposits come with many benefits!
Call 1300 307 155 and start saving today!
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