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Posted On July 22, 2020

Best Ways to Save for Down Payment

Best Way to Save for a House Down Payment

In today’s world, it is important to own a property in your name and if the property is the house you live in, then there’s nothing like it! No matter how good your current rental house is, it’s still not yours. The assurance you get when the roof over your head is owned by you and you don’t have to pay rent to anyone else is a really good feeling. The ever-rising rental rate has also become a major reason why more and more people are opting for buying a house instead of leasing it. It is always advisable to do so because not only is it a permanent solution to all your rent-related problems but is also a great investment.

One of the important things to know before you’re purchasing a house is your budget. While some banks give loans readily, their interests are too damn high which might actually end up costing you more than the house itself. In such cases, most people fall back on their savings to pay the down payment. If you don’t know what it is, let us explain it to you. The down payment is a part of the amount that is given from the credit before the actual purchase is made. It represents booking or finalization of the deal and is usually paid in cash. To keep you from suffocating under the pressure of sky-high bank loans and interest, we have curated a list of ways you can save a good amount for the down payment of the house you’re willing to purchase. If you want to know what these ways are, continue reading!

Switch Card with Cash

Cash

Buying a 2BHK flat in North Kolkata can be quite a task. You have to start preplanning a lot of things and savings shall play a huge role in your day to day life. Not to exaggerate but saving will pretty much not leave your mind for a while. After all, you’re planning on making a huge investment. A lot of people don’t know where to start when it comes to saving. We say start from using cash instead of credit or debit card. It might sound unbelievable at first but people tend to spend a lot less when payments are made in cash form. This is probably because of the transfer of money, quite literally, happens in front of the spender’s eyes. It’s easier to ignore what you can’t see which is why people spend more when swiping cards.

Pull Off Weekenders

benefits of working weekends

If you are willing to spend money on something so big and important then you will have to make certain compromises. Letting go of your weekends is one of them. Working on weekends means extra money and trust us, you will need it. Buying a house is quite a thing to do and the expenses involved in it are innumerable. Not only will you have to save up for the down payment, but also keep some money aside to decorate the house post purchasing it. It is all the more difficult for people who have jobs and fixed salaries. So yes, you can use some extra cash.

Reuse Stuff

reuse old things

The best way to save money is by reusing stuff. Explore the cabinets at your home and assort things that you can make use of. If there are clothes or other items that are in good condition but are of no use to you anymore then go ahead and sell them online. Websites like OLX have the feature of letting you sell your old used stuff such as electronics and even furniture. The goal is to reduce expenses as much as possible

Cut Down on Luxuries

cost cutting strategy

Hurts to say, but if you want to save up for something big or thinking of buying a house then you will have to cut down on the amount spent on luxuries. Push the unnecessary required forth in the timeline. Which means for a while- no more meaningless shopping, no more going out to the movies or eating at fancy restaurants. Whether you’ve marked it earlier or not, doing these things are pretty expensive and you need to save. So explain it to your heart and also your pocket and click on the add to wish list instead of add to cart.

Look Forward To a Smart Investment Plan

Investment Plan

Smart investment plan or SIP is the process with which a certain amount is deducted from your salary account each month. This amount is then multiplied by interest at set intervals and by the end of a certain period, you have a good amount of money in your hand. The consolidated amount received in the end will make sure you not only have enough for the down payment but also don’t go bankrupt after purchasing the house.

Invest in Gold

best way to invest in gold

Investing in gold is a great way to multiply your money. The prices of gold increase too often. Investing in gold will not only make sure that you aren’t spending your money unnecessarily but also block it in something which is more likely to give you better returns. Gold is considered to be one of the best investment strategies and its returns are instant. You can sell off the gold whenever you want to and get cash in exchange for it. Plus, unlike shares, the risk of loss is way less.

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