one of your New Year’s resolutions is to become a
homeowner, now is the time to start a plan to save for
that new dream house. While a 20 percent down payment is
often no longer necessary, you’ll still need a bit of
savings even for lower rates in San Diego’s pricey
housing market. And keep in mind, a larger down payment
might save you money in the long run.
are some tips to get you serious about saving:
you’ll need to have a financial goal. Calculate how
much you will be able to pay for the monthly mortgage
(online mortgage calculators can get you started). The
rule of thumb is that no more than 28 percent of your
monthly income (before taxes) should go toward housing,
which includes the mortgage, taxes and insurance. Once
you figure out how much you can spend on a house,
consult with a lender to decide on a down payment that
will work for you.
rid of debt
off your credit cards will not only save money on those
high interest rates, but it will also help you qualify
for good loans.
make sure your housing fund grows, open a dedicated
savings account. Then have a portion of your paycheck
automatically deposited into the account. The separate
account will help reduce temptation to use the money for
other things. To make the account grow faster, try to
deposit your tax return.
little bit helps. If you stop for coffee on your way to
work, start making it at home and bringing a thermos.
Then each week, put the money aside that you would have
spent on your morning — or afternoon — buzz. Look at
all your expenses, from restaurants and movies to cable
television, wireless plans and gym memberships. Many
items can be cut or reduced. And don’t forget to
rethink the high-ticket items such as your annual
vacation. Make it a camping trip or a "staycation"
and put the difference into your account.
you’re renting an apartment, consider getting a
smaller place to save on rent. The cramped space won’t
seem so bad when you know it’s only for a limited time
and it’s getting you closer to your goal. According to
USA Today, moving from a two-bedroom to a one-bedroom
apartment can save 20 to 30 percent on monthly rent. If
you can’t get out of a lease, consider getting a
roommate to take a bite out of the rental payment.
for overtime or even get an additional job. For many,
this will be the only way to save enough money for a
home because of other demands for the regular paycheck.
a bit of determination, you can save 10 percent of your
income each year. Cut out a picture of your dream home
and hang it on the fridge. It will help you keep your
New Year’s resolution when you’re packing lunch for
more information on real estate and recent Home Pride
columns, visit: sandiegouniontribune.com/news/business/real-estate/home-pride.