Chicago Property Management Blog

Six Money Saving Methods To Buy Your First House

Six Money Saving Methods To Buy Your First House

When you first decide to buy a home, saving money can feel impossible. You should realize that it takes time, but it is very rewarding. Use these 6 tips and start saving money for your first home:

1. Budget.

The first step to saving money is to build a budget! If you already have one, build a better one. If you don't know where your money goes every month, you won't know where you can actually save on. Start by analyzing your bank and credit card statements and locate where you are spending most of your money. See how much you are spending on necessities and then note how much you spend on all the “extras”: think movies, entertainment, restaurants and even online shopping. Once everything is categorized, analyze the areas where you can cut back. Set a realistic budget and try to stick to it as much as possible. By doing this, your dream house is just around the corner.

2. Take the money straight out of your paycheck

Don’t wait until the end of the month (or your pay period) to save money. A very common mistake is saving money after we have spent most of it. The best way to do it is by saving your money as soon as you get paid, and then live off the rest. No excuses. If you want to save money, it is the safest way to do it. You will be surprised at how much you can stretch your money. Taking this little step can help you make your first real estate investment. A great way to accomplish this is to automate your savings. 

3. Rent out your spare room or garage

If you have an extra bedroom in your apartment, you should seriously consider renting it (if your lifestyle allows it, of course). You can use online platforms (like AirBnB) that will let you organize in advance and only rent out whenever it is convenient for you. You can even block out dates when your rental isn't available. Same goes with a garage, if you are not using the entire thing, you can turn it into another income stream.

4. Skip a vacation

If you really want to buy a house, you could maybe cut back on the vacations. We are not saying don't take one, you definitely need vacations to keep a healthy mind and a healthy relationship. However, you can take a nice inexpensive one. You can enjoy a nice staycation and avoid spending thousands of dollars by going on an international trip. Those extra thousand dollars can add up towards your new home. 

5. Provide more value at work, then ask for a raise

You should constantly be looking at how you can provide value both in your personal and professional lives. Once you’ve identified an opportunity at work, go for it! Track your progress and how it affects the company’s bottom line. Once you have proven your value to the company, asking for a raise is a lot easier! Good employers should acknowledge your hard work and reward you accordingly. Make sure to prepare yourself before heading into this discussion by gathering performance data and documenting your value to the company.

6. Cut out bad habits

By cutting out bad spending habits you are not only saving for your first house, you may also be quitting unhealthy habits (whichever they might be). These habits can go from smoking, to excessive online shopping, to spending too much money on take out. Analyze your day to day, and you will quickly realize that you may cut out a bad habit and save money by doing so