Savvy Saving Tips and Tricks

Buying a home is an exciting milestone – and one of the biggest purchases you’ll ever make. While saving a large lump sum for the expenses that come with a home purchase can seem daunting, it doesn’t have to be! There are many different approaches to saving money, so whether you’re looking to put aside a little at a time or send as much over to the savings account as you can one at a time, these hints can help you prepare to start your journey as Homeowners!

Go Big to Go Home

When you’re saving for a home, think beyond the down payment and pad your goal accordingly. Some additional expenses you may encounter include earnest money, inspections, appraisal, closing costs, a deposit on design options and upfront HOA fees.

As you prepare for this life-changing purchase, take the time to calculate your budget, decide how much you’d like to commit for a down payment and other costs and create a plan for savings. Hash out a realistic timeline and build in checkpoints so you can celebrate growth and milestones along the way – without breaking the bank.

Signed, Sealed, Delivered

Even with a solid budget, it can be easy to borrow from money allocated for savings when you overspend in other areas. The envelope budget is a great way to stick to your guns when it comes to spending. Take out cash for your monthly expenses and divide it into envelopes for each budget category, like groceries, dining out, entertainment, etc. As you go through the month, use cash from the appropriate envelope to pay for your items – and don’t cheat by pulling from another envelope! If your bills are set to auto-pay electronically, or you prefer to pay with a check, don’t stress about switching them to cash. Just keep an eye on what you’re paying to ensure you’ve budgeted for them accurately.

At the end of the month, any leftover money in your envelopes can be deposited into savings. And piggy banks aren’t just for kids – as you spend throughout the month, be sure to keep up with your change so you can deposit those coins, too!

Mr. Automatic

With the prevalence of direct deposit and mobile and online banking, it’s easier than ever to move your money in the blink of an eye. Take a look at your take-home income and compare it to your budgeted expenses. Is there extra money? If you have additional income not allocated for expenses, move it into savings as soon as you get paid so you aren't tempted to spend it. Many employers will even allow you to divide your paycheck into multiple direct deposits – if it goes straight to savings, you won’t even miss it!

Small Changes, Big Results

Let’s be honest: you probably won’t hit your savings goals without some sacrifice. Whether it’s your daily Starbucks® fix, impulse buys at the grocery store or splurging on dessert out when you have perfectly good ice cream in your freezer at home, try removing one or two regular purchases a week, such as lunch out or a drive-through coffee, and deposit the money you would have spent into your savings account. You may even want to designate a few “no spend” days each week to hold yourself accountable.

Don’t forget to cut out extra spending with your larger expenses, too. Shop providers and compare prices for your cell phone, cable, internet and electricity. Companies often have promotional pricing around holidays and changing seasons, so if you’re not ready to make the switch to a new provider, give your current one a call to see if you can get a good deal.

When you have a plan and commit to making savings a priority, you’ll be ready for that new home before you know it. Embrace small changes to make huge strides in growing toward your future!