It’s important not to lose focus of your savings goals despite the cost of living crisis and the continuation of rising mortgage rates. We’ve listed our top tips on how you can best achieve your goal towards saving for your first home.
Reduce home spending
Cutting down on your living costs where possible is a great place to start when it comes to saving for your first home deposit. If you’ve moved out of your family home and are currently renting, it could be worth looking for a cheaper flat or apartment in order to reduce your monthly spend on rent.
Try to reduce the cost of your utilities, too. Perhaps you could shop around for the best broadband or insurance deals, just to save that little bit extra every month.
Be sure to review your monthly outgoings and aim to cut back where you can. Weekly trips outs and expensive date nights often add up, so consider becoming stricter with yourself and only spend on luxuries every so often.
Set a timeline
Working towards a set deadline could motivate you to stay on track with your savings goal for your first home. Decide how long it will realistically take you to save the amount you need and work out when you’d like to achieve this goal.
Having a deadline in mind can encourage you to set progression goals, ensuring you can check in with yourself every month and review how well you’re doing and see if you’re on track or not. That way, you can see where you’re going wrong and work on ways to fix this.
Pay off debts
Before setting any savings goal, it’s important to pay off any outstanding debts you may have. Otherwise, you may feel like you’re fighting a losing battle.
Prioritise your debts that have the highest interest rates so you can start boosting your credit score and putting as much money as you can into your savings fund.
Make your money work for you
There are several schemes that can help you put as much money as possible towards your deposit. Rather than just putting your money into a standard current account, shop around for the best ISAs and savings accounts to help boost your savings with minimal effort from your side.
As a first-time buyer between the ages of 18 and 39, you can open a Lifetime ISA account, in which the government can add up to £1,000 every year depending on how much you save. You can add a maximum of £4,000 a year to receive the full 25% government bonus.
Alternatively, fixed term savings accounts offer you a fixed interest rate as you save money over a set period of time.