How to turbocharge your home deposit savings plan
The golden rule when it comes to saving for a home deposit is eliminating outstanding debt and locating hidden pockets of savings. Here are LoanDolphin’s top tips for boosting your savings to help you dip your toe into the property market faster.
1.Purge your plastic
While credit cards are great for emergency purchases or shopping online, they can be problematic if used regularly. Generally plastic cards have higher interest rates than personal loans, so it best to chop them up and pay off the outstanding balance as quickly as you can.
2. Become a bargain detective
I love getting my hands on the latest gadgets, but if you’re committed to saving for a home it’s not always necessary to be the first person on the block with the newest device. I use Gumtree and Ebay to find second hand goods and purchase them at about 30%-60% less than what they would cost in a store. There might be the odd scratch here and there, but as long as the goods work as intended I can live with that. The searching may take a little time, knowing that you saved money is a great reward!
3. Can you save on your rent?
Rent can be one of your biggest outlays, so it’s worth asking yourself – would an extra 15 minute commute be bearable if it boosted your deposit savings? I have a mate who was paying $550 per week on rent and found a place in a suburb that was about 20 minutes further out to rent. Moving saved him $200 per week, which worked out at a whopping $9,600 per year- a sizeable saving.
4. Work on a budget, have goals
Having a plan prevents you from getting lost on your savings journey. Make regular monthly and quarterly goals that your can work towards, but add in some stretch goals. Don’t be
disheartened if you don’t achieve certain milestones, make sure you restrategise and keep going. Remember to reward yourself when you achieve your stretch goals.
5. Do you need a car?
If you have a car and rarely use it, it might be worth considering off-loading it. Once you work out how much repayments, registration, insurance, servicing, washing and other costs are, you might find that you’re better off putting that money into your home deposit account. If you are like me and only use it once a month, can you can get away by using public transport and hiring a vehicle when required. You can hire a car for a day for just under $50 with Nobirds (with only a $500 excess).
6. Get techy with it
I’m a big fan of using marketplace platforms to get things done at a competitive price without compromising quality.
Some great options include:
- ServiceSeeking.com.au: Use it to do any tradie related jobs (there are plenty and ratings and reviews to pick the right sparky, bricky or tooly).
- Groupon: Dining out and getting massages don’t have to be all that expensive.
- Telstra thank you: Grab some movie tickets at a cheaper price than the standard price.
Don’t be afraid to get in touch with your financial institution if you are struggling with minimum repayments for cards or other types of loans. Banks have financial hardship teams who can provide you with options for breathing room, which can include:
- Pausing repayments for a period of time
- Holding off interest accrual
- Reducing rates
The common denominator here is persistence – it may take a bit of effort, but your savings account will thank you and you might be able to get into your own home sooner. If you have any smart saving ideas, we’d love to hear hear from you!
Looking to get a better rate on your home loan? Click here to find out how LoanDolphin works and start the bidding process to getting you the best home loan!