BurkeRealEstateConsultants,Inc
Rich Kushner, BurkeRealEstateConsultants,IncPhone: (858) 405-5270
Email: [email protected]

How to Aggressively Save for a Mortgage Down Payment

by Rich Kushner 12/15/2019

Buying a home will likely be one of the largest financial decisions you will make in your lifetime. While this may seem scary at first, it’s worth noting that buying a home can also be a valuable financial investment.

When it comes to preparing to buy a home, many people just wait until they run out of room in their apartment before deciding that they need to upgrade to a home. A better approach, however, would be to start planning for your first home a year or more in advance.

Saving for a down payment is a vital step to making the best long-term financial decision. A larger down payment can help you pay off your home sooner, pay thousands or tens of thousands less in interest, and start using your home equity as an asset.

But, saving for a down payment is easier said than done. So, in this post, we’re going to talk about some of the ways you can aggressively save for a down payment so that, when the time comes, you can achieve long-term financial security from your investment.

Setting your savings goals

The first thing you should be thinking about when saving for a down payment is what your goals are in a home. Setting realistic goals in this phase will make saving for your down payment more feasible and less discouraging.

Think about what you really need from a home at this point in your life and compromise where you can.

Remember that on top of your monthly mortgage payments, you’ll likely also be paying for taxes, insurance, utilities, homeowners association fees, and more.

Save on a timeline

When setting your savings goal, make sure you’re aware of the timeframe you’re working with. If you want to buy a home next year, you’ll need to focus on short-term savings options. However, if you’re okay with renting for the next 5 years, investing your money could be a better option.

Lock away your savings

Treat your down payment savings like an emergency fund. Open a separate account, automatically deposit a portion of your pay into the account, and never withdraw from it. To do this, you will, of course, need to already have an emergency fund with a month’s expenses in it.

However, once you’ve established your emergency fund, start immediately depositing into your savings account.

Pay off credit cards

It may seem like saving for a down payment is more pressing than paying off old debt. However, the numbers will show that making interest payments on your credit cards is essentially throwing away money that could have been used toward your down payment savings.

Adjust your spending habits

While it isn’t easy to start spending less once you’ve built a standard of living, there are ways to spend less money and still lead a fulfilling life. Think about where your money goes each month, including bills and services you might pay for.

Now could be the best time to cut the cord and start using a service like Hulu to save $50 or more each month.

Time for a raise?

If it’s been some time since your last pay raise, now could be an ideal time to speak with your employer. To improve your chances of success, don’t discuss reasons outside of work that might be influencing your decision to ask for a raise (such as saving for a down payment). Rather, back up your request with evidence of your accomplishments at work.

About the Author
Author

Rich Kushner

I donate 10% of my commission to a charity of the client's choice 

I am committed to helping you with your Real Estate needs and I work with a team of agents locally and nationally - so anywhere you have real estate needs, we can help you, and donate to your favorite cause! Some groups my clients have had me donate to are The Humane Society, Smile Train, Wounded Warriors Freedom Station, Second Chance Dog Rescue and Best Friends, to name a few.

For more than 20 years I have volunteered at the Humane Society, doing PFT program (pet facilitated therapy), where I brought puppies to children's hospitals, and Pets with Santa (picture taking with me as Santa, and people would then make a donation). I have also been active with On The Go, a service where I would drive folks who could no longer drive, to doctor’s appointments, grocery shopping, etc.

When you are buying or selling property in today's real estate market, it's important to have confidence in your real estate professional. My commitment as your local REALTOR® is to provide you with the specialized real estate service you deserve.

In addition to having earned an MBA and a Broker’s License, I have achieved an ABR (Accredited Buyer Representative), SRES (Senior Real Estate Specialist) and CDPE (Certified Distress Property Expert) designations.

I also have been a home inspector on the East Coast, an appraiser apprentice, a property manager and an investor, where I had, at one time, 31 houses and sold all but one! (In Atlanta, Ga.) I now own 25 properties (23 in Atlanta, 2 in San Diego).

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why my goal is to keep you informed on trends in the marketplace using the latest statistics in your local area. With property values continuing to rise, real estate is a sound investment for now and for the future.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call or e-mail me.

Please consider my site as your online source for local real estate information, and return often for the latest property listing updates.