We all want to get our foot firmly on the property ladder. However, these days it isn’t quite so easy and most properties require a hefty deposit. But don’t be disheartened, saving up for one isn’t quite as impossible as you may think. Desperate to buy your first home? Here’s how you can save for a house deposit.
Invest Your Money
There is no point just keeping your cash in a current account. These types of accounts don’t get that much interest added onto them. So it is a better idea to invest your money in high-interest investments. Things like stocks and shares can help you increase your money quickly. However, they can be fairly risky at times. For a low-risk investment, place your savings in a high-interest bank account. As this will give you higher returns than a current account.
Downsize While Your Rent
If you are currently renting a house or apartment, consider looking for a smaller place. Do you really need a three-bedroom flat while there are just two of you? After all, you will be paying a lot of rent for that spare bedroom. That’s extra cash that could be put towards your deposit. If possible, it is a good idea to look at the market’s current best rental apartments to see if you can get somewhere smaller for a good price.
The government has set up a couple of help-to-buy schemes over the past couple of years. The schemes are in place to help first-time buyers buy a new-build home. You will need a smaller deposit than if you were buying a home without one of the schemes. There are also a couple of schemes that help buyers get their first mortgage. Have a look online if you think you may be eligible for one of these schemes.
Budget Your Money
Sitting down at the beginning of each month to plan your money can help you make significant savings. Take a look at your regular incoming and outgoing money, and use these figures to see how much you have leftover each month. Each month, put a large part of this leftover money into a bank account to save for your deposit. If you are strict with yourself, you will be very surprised at how much you can save!
Save Your Money Wisely
You need to place your money in bank accounts that have a high-interest rate. This way, you will get a higher return on your money than if you had just left it in your standard current account. Visit your bank and ask them about the various accounts they have, and what their benefits are. It is also worth asking about ISAs as these often have much higher interest rates than all other bank accounts. Plus, you can save your money in an ISA tax-free.
Don’t be put off from saving for a deposit. It will take a long time and will require you to be disciplined with your money, but it will certainly be worth it in the end!