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Create a Game Plan for Saving for Your First Home

by Arne DeWitt Group 12/31/2018

You’ve been thinking it for a while: “I really should start putting some money aside for a down payment.” But, you just can’t seem to find any wiggle room in your budget.

You’re not alone. Saving for a down payment isn’t easy. Especially if you’ve got rent, car payments, student loans, and are trying to put money aside for retirement.

In today’s post, we’re going to talk about how to make a game plan for your down payment. This way, you can start saving immediately, bringing you closer to your goal of homeownership each day.

Step 1: Give each dollar a job

The first rule of budgeting is that you need to know where each dollar you earn ends up. From there, you can start re-allocating funds to the things you want to save for.

There are many apps and tools available to help you out with this process, including YNAB (You Need A Budget) and Mint. If apps aren’t your thing, you can always use a simple spreadsheet.

First, account for all of your income. This could include your salary, rental income, or other forms of money that you have coming in.

Next, detail each of your weekly and monthly expenses. Everything from groceries to the internet bill and retirement contributions.

Step 2: Reassess your expenses

Now it’s time to make some tough decisions. Are there ways you can cut down on your weekly or monthly expenses? Maybe you aren’t using that Amazon Prime membership as much as you thought you would. Or, maybe you’ve decided you don’t really watch anything on cable but the news. There are a number of ways one might cut back on their monthly bills.

Get creative with family plans, bulk shopping for food, or cooking budget-friendly meals. All of these savings will add up quickly.

Step 3: Pay off small debts with high interest

Let’s face it, if you have thousands of dollars in student loans, you might not be able to aggressively pay them down by the time you want to move out of your apartment.

But, for small debts (under $1,000 credit card debt, for example), you could save more in the long run by paying them off and avoiding interest payments.

Step 4: Be smart about your savings

With the right savings account and credit card, you can earn money through savings interest and through cashback rewards on credit cards.

First, find a savings account with the highest possible interest rate. These can often be found from choosing an online bank who doesn’t have the overhead of running branches.

Next, direct deposit a set amount of your paycheck each week into that savings account. This way, you can be sure that you won’t dip into your down payment savings.

To generate additional income, you can use cash back rewards from credit cards for things like groceries and gas. Choose a credit card that offers the best cash back rewards for things like groceries and gas purchases. The key here is to only use your credit card on necessities and to always pay off the card in full at the end of each month.

If you follow these four steps, you should be able to streamline your down payment savings process and start saving right now.

About the Author

Author
Arne DeWitt Group

There are a lot of real estate agents serving the South County real estate market, but few with the longevity, experience and professionalism of Arne DeWitt.

Arne graduated from California State University, Northridge with a BS degree in Business Administration and soon put his business skills to work in his real estate career with RE/MAX that now spans more than 30 years.

During his career Arne has listed and sold more than 1500 homes, resulting in 750 million in sales and garnering every production award given to top producing RE/MAX agents – including the prestigious Chairman’s Club, Hall of Fame and Lifetime Achievement Awards.

Never one to rest on his laurels, Arne has continued to hone his professionalism and knowledge. Throughout his illustrious career he has earned several esteemed professional real estate designations such as GRI (Graduate REALTOR Institute), CRS (Certified Residential Specialist) and ERC (Employee Relocation Council)

But it’s not the awards and industry accolades that fuel his passion – it’s a genuine desire to help his clients achieve their real estate goals and dreams. Arne is most proud of the high percentage of referrals and repeat business he receives from satisfied clients who shower him with thank-you letters with comments such as:

“You made the selling of our home a pleasurable experience. You should clone this guy!” and “Arne did everything he said he would do and more!”Arne Dewitt

When not working as your community relocation specialist, Arne likes to unwind by participating in sports such as golf, fishing, and hockey. He also enjoys coaching boys’ sports and spending time with his sons, Wesley and Matthew. Arne is active in his church and donates time and income to individual charities.