Saving for your down payment

Coming up with the cash for a down payment on a new home can seem daunting, some tips from CBS Money Watch were worth sharing. Saving money for such a major investment is worthwhile and can be accelerated with a few easy strategies.

Add to your monthly savings account automatically: Create a savings account specifically for the down payment and commit to devoting a comfortable amount out of your paycheck to it every pay period. Whether it’s $20 or $50 on a regular basis, every bit helps. Talk to your employer about setting up an automatic payment that goes directly to that separate account.

Sell things you don’t need online: Whether it’s antiques, furniture or designer bags, chances are someone else is looking for it. It’s an easy way to declutter while earning money that can go toward putting you in a new home.

As much as I hate to say it, skip the morning latte: It’s true, those $4 coffees add up to thousands per year. See what other indulgences you can cut from your routine. For example, consider cheaper haircuts, early-bird pricings on dinners and movies, and biking or taking public transportation to work to cut down on costs. Try using Groupon or other coupon services to stretch your entertainment budget, while saving more for your new home.

Get rid of your landline: Use your cell phone as your primary means of communication, and check with the cell phone company to see if cheaper plans are available. For instance, if the provider offers free nights and weekends, limit your calls to those hours and cut the extra minutes allotted. Also consider computer video-chatting, which is often free, instead of relying on costly long-distance phone calls.

It’s truly worth the effort for the tax benefits, and long term wealth building you’ll gain from home ownership. Please call Eva or I, or one of our preferred lenders if you’d like to talk about down payments and the savings you should work towards to purchase your new home.