Before you begin the process of applying for a mortgage, most first-time buyers will need to save for a deposit. Despite more 95% mortgages becoming available again after the struggles of COVID-19, which was announced on the Budget 2021, it can still be difficult to save up enough for the 5% deposit.
Set a target and plan your budget
Decide on the size and location of your ideal home, research the average price and calculate 5% of that for your target, 10% if you are feeling ambitious! Now you know how much you will need to save up in total, the next part is working how much you’re able to put away each month and set the time frame in which you aim to achieve it by. That’s the easy part!
Get a savings account and set up a standing order
Instead of hiding your deposit under the mattress, make your savings work for you. Shop around for a new ISA or savings account, some will offer you a higher rate of interest if you commit to locking the money away for a year or more. You will surely have every intent on putting away a sum each month, by setting up a standing order a couple of days after your payday to your ISA or savings account will ensure you don’t even have to consciously think about it.
Cut out the take-outs
Cutting out or substantially reducing the amount you spend on take-outs and opting for home cooked meals will certainly add up over time. This can include making your own coffee and taking it to work in a re-useable cup rather than buying one on your way (much cheaper and also way more environmentally friendly!), meal prepping your lunches rather than buying pre-packed convenience food and making home cooked dinners rather than that naughty order for pizza. Not only will this help expand your savings, but could help slim down your waist line – bonus!
Declutter and sell
Selling your unwanted and unused items may not make you an overnight millionaire, but you could be surprised by how much money you make. Especially now it isn’t only limited to car boot sales with the many new second hand apps and websites available.
Save on your rent
Moving back in with your parents may seem like a step in the wrong direction, or even an impossible solution. So alternatively, you could consider the options of getting a house mate to help with the rent or moving into another rental which is cheaper, to allow you to save more money each month, with the possible added bonus of cheaper bills, especially if shared.