10 Tips for saving for a downpayment on your first home

Saving a large chunk of money in a short amount of time, to put together for a downpayment on a home, isn't always an easy task. Financial experts suggest you take a look at what you are spending every month on variable expenses. Once you have made note of where you money is going you can better allocate it. Below are 10 tips I have found work in saving for large purchases in the past.

Tip #1 - Work overtime - if you jobs offers overtime or extra shifts let it be known that you would like those extra hours to your co-workers and employer. A few extra evening shifts and some weekends and you might have a downpayment in no time!

Tip #2 - Sell your stuff- the old saying "One man's trash is another man's treasure" always rings true. Take a look through old boxes and see what you aren't using or need anymore. Maybe those old university text books or DVD's would serve someone else better? Hold a garage sale or post the items on an oline sales sit such as ebay, Craigslist or kijiji.

Tip #3 - Trim the fat - Maybe you don't need the delux cable package, the multiple magazine subscriptions or 6$ speciality coffee every morning on the way to work? Take a look at every penny your are spending and ask yourself "Do I really need this?". It is important however not to cut out everything. Keep the ritual of beer and wings with friends as a treat. By treating yourself every now and then the taks of cutting out other luxuries will be easier to handle.

Tip #4 - Look at your interest rates. Most of us don't know what the interest rate on our credit cards are. We were suckered into getting the card last Christmas when it would give us 15% off a big ticket item and have never read the fine print on the contract that states that if you don't pay your bill in full within 21 days the itnerest rate is 30%! Some credit card companies offer a low balance transfer rate for 6 months. If you are committed to paying off the debt you have investigate this option and work to fully pay off the interest rate before the end of the 6 month period. Upon completion of the balance payment cancel the card to avoid further temptation of use.

Tip #5 - Shop around. Just because you have been with the same insurance company since you first began to drive doesn't mean they are offering you the best rate. Contact other companies and see what they are willing to offer. The same goes for phone and cable companies. As your contracts come to a close shop around to see if you can get something better for less.

Tip #6 - Obtain Part Time/Seasonal Work - as the holiday season begins to approach retailers are beginning to think about hiring for the Christmas rush. Get your resume ready and start keeping your eyes open for part time seasonal jobs. The hours might be long, especially if you already have a full time job, but you can find solice in the fact that its not forever (likely 6-8 weeks). Some retailers offer great discounts as well to their employees which might help with your Christmas present budget.

Tip #7 - Make the money you are saving harder to get to. If you think your savings journey is going to take a few years invest your money into an RSP to gain interest. Alternatively talk to you bank about a Tax Free or High Interest Savings Account. Some of these accounts allow you to still remove money from them but require you actually physically go into the bank to do so. Not having easy access from your debit card is always a plus when saving for a large downpayment.

Tip #8 - Live on Cash. Every pay day give yourself an allowance in cash to get you through to the next pay day. If you don't have the money in your wallet or the funds are getting a bit low you may think before buying the new $50.00 sweater "you just have to have".

Tip # 9 - Let everyone know you are saving for a home - By letting friends and family know you are saving for a home you are making a commitment to save money. In addition friends and family will better understand your circumstances and maybe instead of suggesting going out for dinner to chat they will instead suggest staying in and chatting over a bottle of wine.

Tip #10 - Give yourself an attainable timeline - Life happens and every now and then you may encounter a few speed bumps that knock you off course. By setting an attainable timeline you will always have something to work towards. By setting the timeline you may find that you work harder as the deadline approaches to reach it or get as close to it as possible.


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