Tired of Renting? 7 Ways to Save for Your Down Payment

When you’re ready to make the move from renting to buying, accumulating a down payment is one of the first steps you’ll need to take.

If you’re not sure how much money you’ll need, here’s a simple formula for your starting point. Determine what size house you THINK you’ll want to purchase and aim for 20% of that price. Although 20% is typical, some mortgages feature a low down payment option.

Start Prepping With These 7 Tips:

  1. Cancel or downgrade your cable subscription. There are many options for watching your favorite shows that don’t require an expensive monthly commitment.
  2. Brown-Bag-It for lunch and break up with your fast-food delivery service.
  3. Get a part-time job to generate extra cash. In today’s gig economy, you can find supplemental income with TaskRabbit or UBER.*
  4. Unload excess clothing or other items by having a garage sale or taking them to a consignment store. Virtually, you can reach a wider audience with eBay, letgo and other online swaps.*
  5. Add a roommate, choose a less costly rental property or move in with your parents. You, too, can be a part of the boomerang generation!
  6. Eliminate your gym membership or choose a facility with fewer amenities. Better yet, enjoy the great outdoors while exercising.
  7. Cut your commuting costs by carpooling, finding a less expensive parking lot, taking public transportation or biking to work.

When you’re ready to build equity in a home of your own – and stop spending money on rent – these tips are a great place to start!

* This does not imply an endorsement of these websites or apps. Always confirm the safety and reliability of online sources.

- By Jena Harwell, Jul 25, 2016