6 Ways To Save For Your Next Home
A home purchase these days will require a good amount of money down as you secure your mortgage. With home prices the way they are it only means that you will need even more to put down. One can certainly put less than 20% down but that can leave your offer looking less strong in today’s competitive market. So unless you are pulling a good amount of equity out of a home you are selling, then here are some helpful strategies to save to buy your next home.
Pay House Fund First
A great way to keep your house funds from getting clouded by other savings is to keep it separate in its own account. Get in the habit of paying it first, just like it’s one of your bills every month. Automatic and recurring transfers are also a great option if possible.
Fund Your Down Payment
Some people are lucky enough to have friends and family that will want to contribute to your house fund. There are a few options out there like HomeFundit or Feather The Nest which allow you to approach your goal in a similar fashion as GoFundMe. You can set target amounts and deadlines too.
Some apps or even banks will help you save by rounding up your payments to the nearest dollar and will funnel the extra change into a designated account that you have set for a home. Over time these things add up!
Local Assistance Programs
Some local governments offer down payment assistance programs and grants. Many are often income-qualifying but there are others for teachers, firefighters, and the like.
Check Your Taxes
If you are one who gets a decent tax return each year then you may consider lowering your exemptions to regularly take home more cash and invest and save it.
Check Retirement Savings
This one should more than likely be a last ditch effort. A few things should be considered here like your age, whether or not your IRA or 401k allows a one time withdrawal for down payment with no penalty and the like as replacing this money will take time of course. Your financial planner will be best to shed light on this option for you.