Buying a house on loan is pretty common for the majority of salaried people in India. While home loans are becoming easier, saving for the downpayment is a hefty task. The downpayment is an amount paid upfront initially against the purchase of the property. It is around 20% of the value of the property but sometimes, it amounts to 80% of the sealed price too. That is a huge amount and it needs proper planning to save such an amount. For the people living on the fixed monthly income, the task is tough. Let us see how you can save for buying your own house.
1. Identify needs and necessities
Before making any purchase, decide if that is a need for you or a mere luxury. Hold any big investment until you buy a house. Prioritise the expenses, you can delay some purchases until after you arrange for the down payment, the loan can manage the rest. The bigger the down payment, easier it would become to get a loan.
2. Quit online shopping
As convenient as it is, you can spend more than required on online shopping easily. The payment is to be done either online or at the time of delivery, so you are bound not to think too much about the money. Cut on the online shopping as a first step to cut on the expenses. Most of the impulse buys happen online.
3. Have a saving plan
If you are daring enough to invest in the mutual funds and stocks, you can earn significantly but the market is not stable. The safer mode to earn in the period of time is the fixed deposits. Contact a financial adviser and learn how to boost the savings to have some extra income.
4. Have a saving target
Sit calm and relaxed and then decide how much you can save comfortably in a month and then calculate how much time you will be able to gather the down payment. Now push that limit a little bit to come closer to your dream home. Do not push too hard that it becomes hard to live. Have a contingency fund too, do not invest the last penny in the down payment.
5. Get rid of extra stuff
Do not shy to sell the useless stuff lying in your living room in exchange for extra money. You can sell such things easily online and get the rightful money. Anyhow you are moving to a new house and you would be getting new stuff for the house. It is not wise to take extra stuff to the new house so why not get rid of them to collect the down payment.
To earn some extra money, you can freelance the job you are passionate about. If you like to write, you can do freelance writing. Try to keep the second job interesting because if this is just a way to earn more, the plan may fail badly in a few days.
7. Sharing is caring
Share your house with a roommate or move to a house with cheaper rent. This is a shorter phase of your life which would pass, look what you can achieve in the future by being smart today.
Moreover, do not be quick in spending the gift money, bonus, tax refunds or any other unexpected money. You can save such money to add to the down payment. You may feel tension for some time but that is just for the better future.