Buying a home is a big commitment as well as a big investment. You must save enough money for both the down payment and closing costs, which can add up to several thousand dollars. Unless you are a Veteran using a VA loan, you typically need between 3% and 20% of the price of the home for the down payment. First-time buyers may take advantage of programs designed to keep the initial costs low. However, a 3% down payment on a $200,000 house still amounts to $6,000 plus closing costs.
To speed up the saving process, you can increase income or lower costs. Try the following methods to save for a down payment on your home.
Creative Ways to Increase Your Income
Sell Craft Items on Etsy
If you enjoy creative work, then you can make money selling your creations. Whether your passion is in photography, jewelry making, sewing clothes, or woodworking, you can capitalize on a large audience of loyal followers on Etsy. Present your work in home and living, jewelry, clothing, art, wedding, toys or entertainment. The website does not cater to lowest price providers, but rather focuses on highlighting your creative work and receiving fair pay for custom pieces.
Grab Your Camera
It is not necessary to be a professional photographer to make money on the side. Start a side gig photographing everyday items such as travel adventures, plants or animals and sell them on micro photo sites like Shutterstock. It is also possible to specialize in photographing people and special occasions. Whether you enjoy taking pictures of families, weddings, or babies – people will pay to have their photo taken. Instagram and Pinterest make it inexpensive to promote your services.
Take Care of Others
Child care, elder care, and pet care are side businesses in high demand. Families go out of town and need their pets looked after. Parents look for extra hands to help with children on summer break. Eldercare can allow seniors to remain in their home longer. In many cases you do not need special skills to find work.
Related websites allow you to offer services and find work locally without paying the typical upfront expenses associated with starting a business. Pet Sitters International specializes in bringing pet sitters and animal owners together. Register at Care.com to connect with families looking for child care, senior care and even tutoring.
Busy families are happy to outsource yard work. Jobs might include mowing lawns, planting flowers, or raking leaves. If you enjoy working in the yard, you can earn additional income by helping friends and neighbors. Connecting with the neighborhood newsletter could allow you to promote your services at little or no cost.
Meal preparation is another area commonly outsourced. Busy families struggle to prepare healthy, creative meals every evening and end up eating out when time runs short. As a result of busy schedules, there is rapid growth in the meal preparation industry. Earn money on the side by helping others plan and prepare a week’s worth of meals.
Donating blood plasma can help save lives while earning money on the side. The process removes the plasma out of your blood, which helps individuals fight infections. The amount of pay will vary by company and location. Plasma centers frequently run specials to promote participation. They might pay a bonus for multiple visits or pay a higher amount to first-time participants. Most major cities have donation sites, and it takes about an hour per visit after setting up an account. You can receive anywhere between $40 and $75 per visit, with the ability to donate twice a week. Regular donors make between $60 and $100 per week. Donating twice a week for a year could put as much as $5,200 towards the purchase of a home.
Creative Ways to Increase Savings Through Cost Reductions
Lower Food Costs
Food is one of the most variable costs in a household budget, making it one of the best places to save money. Separating your grocery store budget from eating out can give you a more accurate picture of where your money goes. Cut each area by 10% and then watch your spending for a month to identify additional ways to save.
Using coupons at both grocery stores and restaurants can help lower costs. You can also use weekly specials to plan your menu, shop with a list, and avoid the grocery store when you are hungry.
Reduce Household Expenses
Lower ongoing monthly costs by completing a line by line audit of monthly bills. Cancel subscriptions you do not use and eliminate charges for services you don’t need. Savings can add up to $100 or more per month.
Conservation measures in your home can lower utility bills and save money each month, Redirect savings to your house buying saving account.
Save on Entertainment
As a discretionary expense, you can free up money for a new home by keeping a close eye on entertainment costs. For example, you might spend an evening at home playing games or watch a movie, rather than going to the theatre. A date night at the local theatre can add up to $50 for a couple. Bring the kids, and you could spend up to $100 when you add high priced snacks to the cost of entrance.
Look for free local events, spend time outside at local parks, and entertaining at home are creative ways to lower your entertainment costs without cutting out the fun.
Saving money for the down payment for your new home doesn’t have to be a chore. Discover your talents and then look for ways to convert that income a profitable side gig and take a close look at spending to find places where you can cut back. Making a conscientious effort to save money will allow you to cut back without lowering your quality of life.