Home ownership is an incredible milestone! It can provide financial stability and peace of mind. Saving to buy your first home is a significant financial goal, but with the right plan you can do it. Your Domain Advisor can help you establish and implement a plan, but below are a few steps that can help.
Create a budget: Start by determining all of your income and expenses. Then, identify how much money you can set aside each month towards your home savings goal. You will also want to figure out how much money you are comfortable spending on your monthly mortgage payments, HOA or maintenance fees, and property taxes as this will help you decide on a price range.
Set a savings goal: Determine how much you will need for a down payment, closing costs, and other expenses associated with buying a house (i.e. moving expenses, new furniture, etc.). While putting down 20% is not required in most cases, it may help you get a better interest rate and avoid having to pay for Private Mortgage Insurance (PMI).
Open a dedicated savings account: Having an account specifically for your house fund will make it easier to track your progress and will help keep this money separate from your other finances.
Automate your savings: Set up automatic transfers from your checking account to your dedicated savings account, based on the budget you created. This will allow you to have a disciplined approach to reaching your goal. If you want to reach your goal faster, consider what expenses you can cut back on and redirect the additional savings towards your goal as well.
Look for government programs: Determine what programs are available in your area. You may be eligible for a first-time homebuyer grant or career-related interest rate discount. These programs may help you save money on your down payment or closing costs, or even your monthly payments.
Remember, buying a house is a long-term goal, but by creating a plan and sticking to it, you can make it happen. A great way to achieve this goal is to set up a home savings goal through the Domain Money platform. You can set aside a portion of each paycheck into your account. These accounts are individually FDIC insured up to $250,000 by our bank partner WebBank, member FDIC and earn a highly competitive rate annually. Small steps can lead to great outcomes! If you have questions about how much to save, your Domain Advisor can help you.