Breaking into the housing market is a daunting prospect. You have to do things like paying off student loans, afford rent, and still have some sort of a social life, all the while trying to put away thousands of dollars to purchase a place you can finally call your own. Here are six tips to maximize those savings efforts.
- Move in with your parents or in-laws – Everyone likes to give millennials a hard time about not moving out of their parents’ homes. But with the price of housing skyrocketing and wages staying stagnant, the best way to save money is to eliminate your largest expense, which is rent. A $1,000 dollar-a-month rent payment over one year can put $12,000 in your pocket. Even if you still have to pay a token rent payment to your parents, you can easily save for a down payment in a fraction of the time you would have otherwise
- Find a less expensive place to rent – Moving in with your parents seem like an extreme measure? Try finding a less expensive apartment. Do you really need that second bedroom for the three times a year people come from out of town? Is being right in the heart of the city an absolute MUST? Take the money you are saving and put it right in the bank instead.
- Use public transportation – Getting rid of one of your vehicles or going completely vehicle free not only saves you money on the cost of that vehicle, but you also eliminate the cost of gas, parking, insurance and maintenance. Did I mention INSURANCE?
- Stop eating out – You don’t need to buy lunch every day. Using leftovers from the night before or picking up the right groceries during your weekly shopping trip will not only be cheaper, but probably a heck of a lot healthier as well.
- Take smarter vacations – Maybe you don’t need to go to Mexico this year. A weekend trip to a Bed and Breakfast or staying home to explore your local attractions can save you thousands.
- Pick a price limit on gifts – Is it really necessary to buy a $250 birthday gift or Christmas present? Do you need to go out for Valentine’s Day dinner AND purchase a gift? Be smart about the things you actually want vs need and think how much better those celebrations will be once you have your own place.
The sweet feeling of walking through your own front door is way better than any take-out burrito. Small financial savings, over time, make a big difference in your ability to buy your first home.