Saving towards your first home requires a focused approach and patience. Now is the time to begin working towards your goals. Every day is a chance to make a fresh start, aligning your actions which will lead to the greater good. "Rome was not built in a day," but with a few tips, you will be able to gain and make progress.
Save A Little Every Month
It may sound confusing, but setting aside a portion of your income early on will add up when considering your future homeownership goals. Try to make a budget that includes necessities, entertainment, health and determine how much you can afford to put aside. Approaching your budget with discipline will pay off in the long run.
If you can, pay yourself first. Make arrangements with your employer to have a standing order arranged with your commercial bank or Building Society. Place your funds in an account that you designate for your homeownership goal. Try not to use your debit cards or make withdrawals from this account! It might be tempting, but keep your home at the top of your mind. Do some research on saving instruments that offer "high yield" or "high-interest rates" you may be able to garner some return on investment with your consistent saving habits.
Invest, Invest, Invest
Do you still have a way to go before buying a house? If your goals of home ownership are in the medium-long term, based on factors such as finances, your career and family obligations, it might be a good idea to not only pay yourself first but to invest your funds in areas that will bring a long term pay-off towards your goals. It's a good idea to shop around and engage a financial adviser and a firm that meets your needs. Never fall for "get rich quick" schemes. If it looks too good to be true - it probably is. "Think and Check, Before you Invest," if you are unsure of the legitimacy of any investment you are about to make, it's a good idea to check with the local regulatory body to ensure your safety (Financial Services Commission).
Do Regular Credit Checks
A relatively new concept on the Jamaican landscape - the impact of credit checks and credit bureaus. Financial health is largely dependent on how your debt is serviced. Data relating to your debt and pay back history are now curated for referencing and can play a significant role in your access to credit, especially a mortgage. Be sure to clear out your financial closet. Make note of all outstanding debts and service them properly, consider refinancing or speaking with creditors to work on payment plans that work best for you and that will reflect positively on your credit.
Check out the Bank of Jamaica FAQ page on Credit and Credit Checks here.
Cut Down On Expenses
Are you wasting money? Try to eliminate wasteful purchases from your monthly expenditure. Resist the urge of impulse buying! Buy what you need, not all the things you may never use.
- Paying for a gym membership you never use? Maybe you could consider creative and less expensive ways to get fit, like doing home workouts, going for a walk or run in your current neighbourhood, or making it an inclusive activity by going with neighbours and friends.
- Consider cutting the cord. Watch local TV using online streams, or invest in a Netflix or a cheaper cable package.
- Move back in with family members; eliminating or reducing rent expense could help you to save more towards your home.
- Stop wasting food! Try to buy what you need, store food correctly and reduce waste by reviving your leftovers.
- Take public transportation (If feasible). Public transportation in many cases works out cheaper than driving every day and reduces wear and tear on your vehicle. The additional savings can be allocated to your home ownership goals.
- Examine your entertainment expense. One less night out with friends can add up to major savings. Get creative with your social engagements by doing activities that require less spending such as picnics, house parties, go to a free local beach or volunteer with a local charity.
Monetise Your Hobbies/ Find Additional Streams of Income
Look at your hobbies, how can you earn money doing the things you love? That's right if you have a unique set of skills it may be the right time to start making money doing just that. Craft making, hairdressing, mechanic work, baking, sewing, fitness or fitness instruction, technical skills and other creative and productive areas are always in demand. Your network is a good place to start, begin with a small number of clients and work your way to the top. You never know it might just be your key to success.
Looking for a more aggressive approach?
Okay, okay, we get it. The house you want is on sale NOW, and you feel the need to catch it before it's gone. Consider selling your assets such as a car or liquidating your assets to move closer towards your down payment. Be sure to think about the impact this will have on your day-to-day activities as well as the long-term effects of a mortgage. Slow and steady is the best way to build a sustainable future and to maintain the lifestyle you hope to achieve along with having a new home. But, it's not far-fetched to live "humbly" for the greater good.
Create a Vision for Your Future
Keep your goals at the forefront, envision your future home's elements and how you would make it your own. Download your FREE First-Time Home Buyer e-Book to see just how to get the ball rolling!