Every penny counts when you’re planning for the future. If you’re struggling to gather the funds to put down for a deposit on your home, reviewing your spending choices and picking up some canny tips on saving can be a huge help.
We’ve put together five top money saving tips and valuable pieces of advice that, when put into practice, should help you save for something special like a deposit for your first home.
Open a savings account
Opening a savings account is one of the best ways to save money. Find a savings account with a favourable interest rate and set up a Direct Debit to automatically pay cash into it every month. If you’re specifically saving for a house deposit and managed to apply before the scheme closed to new applicants, Help-to-Buy ISAs are savings products designed specifically to help people get onto the housing ladder. The government tops up the savings you manage to put away.
Try own-brand goods
The price difference between household names and own-brand goods can be vast but the quality they deliver is barely distinguishable. Items from tea and coffee to washing powder and bread can offer a saving. Experiment with the cheaper equivalent of the goods you regularly buy to save money, and you may even discover you prefer the more affordable products.
Consolidate your debt
Consolidating debt is one of the best ways to save money. Avoid paying extra on different rates of interest by looking for the lowest interest rates available and moving any debt you can. For example, if you’re paying 5% on a £2,000 overdraft, it’d be sensible to pay off the overdraft, take out a 2% personal loan and commit yourself to paying off the loan before the introductory period ends and the rate rises. Another tip is to remember debt invariably costs more than savings will earn. Get rid of it as quickly as possible as a way of saving money.
Learn to budget
Taking control of your monthly budget is a frugal money saving tip that does wonders for your savings. Set yourself defined limits of expenditure in key areas like food, transport, socialising and clothing. Simultaneously, try to reduce your regular outgoings. Use switching websites to find more affordable costs on your regular products and services. This means things like car insurance, gas and electric, mobile phones and broadband. Make it a habit to regularly check you’re getting the best deal for your needs.
What could you do to bring additional cash into your pocket? Could you let a spare room, car-share or sell items online? By becoming more open-minded, you’ll be able to identify the perfect money-spinner for your lifestyle.
Our top money saving tip is to be determined and dedicated so you can eventually save enough to begin your property search. Once you’ve got that deposit in place, you’ll already be in the habit of careful money management. It means when you do secure the ideal mortgage, you’ll be more than prepared to become a financially responsible homeowner.
Information on the Buy-To-Let scheme was updated October 2020.