Saving Tips Toward Owning Your Dream Home

Homeownership is vital to building and preserving your wealth. Real estate is also an excellent investment option considering it gives high rates of return at the lowest risk. 

Saving up for your dream home can sound close to impossible; however, a solid saving plan allows you to pay a down payment for the home of your dreams. 

Here are some tips to consider that can draw you closer to becoming a future homeowner;

  1. Build a better budget

It is paramount to have an overview of how much you spend on necessities, loan repayments, and additional utilities, as explained in our previous article. It is also essential to consider your monthly expenditure on non-essential items like restaurants, travelling, and entertainment. Analyze your monthly income, credit card payments, and bank statements. Through this analysis, you will know which expenses to cut back in your saving process. 

  1. Open a Savings Account

Fortunately, financial institutions offer saving accounts with lucrative interest rates after a certain period. For example, Amica Savings & Credit offers various savings accounts that can draw you closer to achieving your dream of owning a home. An Investa Account that offers interest of as high as 10% on deposits annually is a great example. Always include the savings amount in your budget.

  1. Automate your Savings

To grow your savings deposits, consider having a standing order instruction from your current account to your savings account, depending on your income source(s). Having a standing order saves you from the temptation of overspending. This little step will make a noticeable difference to your savings growth over time. For example, Ksh.100 deducted daily for five years makes Ksh.200,000 in five years. If you are on salary, consider having the deduction done through payroll.

  1. Manage your Debt

A portion of your income typically goes to repay any pending debt. These could be bank loans or money owed to suppliers. The burden of debt makes it difficult to set aside money for savings. Consider having a clear schedule on debt repayment, paying on time, and avoiding overborrowing to lessen the financial burden and make savings achievable.

  1. Consider a Side Hustle

We are lucky to be alive in the gig economy. During the Covid-19 pandemic, people highly embraced the side hustle routine. Consider having a few hours from your daily activities to work on your preferred side hustle. Additionally, technology has made freelance opportunities more available and accessible, which has promoted the success of numerous side hustles in the long run. Most of these jobs require few qualifications, making it easy to earn extra cash to put into your savings account. This quick cash acquired from a side hustle will boost your savings account, aside from the regular savings allocated from your monthly income. 

  1. Downsize spending

It is advisable to reduce your expenses and practice minimalism. A great start would be only spending money on the things you need and cutting down on bad habits. You could also consider moving into a more affordable house or estate, selling one of your extra cars, or considering public transportation to save you that extra coin. Through this, you will only spend money on necessities and divert the extra money to your savings account. 

Before considering opening your savings account, have a solid plan and budget in place. Then, with a few lifestyle changes, a savings plan, and great self-will to implement financial discipline, your dream of owning your dream home can become less dreadful.

Amica Savings & Credit offers excellent professional advice and achievable quotations and goals to draw you closer to owning your dream home.

Talk to us if you need a friend to help you Plan Smarter so you can Live Better?

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