Buying a home is a dream many of us wish to fulfill sooner or later when we reach a certain (marrying?) age. It’s a major milestone many claim to have, but it’s also one of the things that financially scares us.
While it’s true that surveying for a new house is exciting, you also might’ve heard of some friends or other people’s regretful home-buying mistakes. Not to mention the housing meltdown that gave it a bad rap for being an utterly confusing and stressful process.
But it doesn’t have to be that way.
Here’s a quick checklist that will help shed light on some of the ways you can reduce stress and prepare yourself financially before buying a house.
Set up a monthly budget. You can start building savings by spending less than what you’r earning. Therefore, your financial goal must begin and end with your monthly budget. It’s vital to be both realistic and honest about your spending habits from the start, then stick to it as much as possible. Using electronic bill is a good way to start, because the payments automatically occurs.
Lock up your savings. The best way to avoid this hurdle is to make a dedicated bank account just for your housing fund, and then lock it up. You will still have your regular checking account and debit card to pay the cable and rent, but that special savings account will be off-limit to you.
Start automatic savings. After creating a dedicated savings account, ask your payroll department to make a fixed amount of your salary go directly to that dedicated savings account and the balance sent to your standard checking as usual. Good thing about this is that you won’t even notice that you’re already saving a lot. The idea here is paying yourself first, so you won’t have any excuses.
Survey Houses. It’s hard to save without seeing your goal first. With this, you should start with the end in mind. Look at local home listing or the ones available online like the properties for sale on McGrath . Of course, you should begin first with communities near you, the type of culture you want in a place where you can easily go to work and have the necessities you will need in the future. Take note that you can also apply for home loans to speed up the buying process.
Save in big quantity. While it’s easy to save quick money each week by depriving yourself of your favorite late night chips, you can make a better impact by cutting out your biggest expenses. For example, skipping your annual out of the country vacation, while not easy, will add a huge chunk of dough for your housing fund. This is a sure and effective way to build up your savings quickly.
There you have it. The next step is applying what you learned, and you’re on your way! What other pre-home buying techniques did you use in the past? Share it with us!