6 Financial Tips to Help You Save For a Home

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Down payment. For many people, those two words are the main obstacle standing between them and homeownership. Whether you’re working toward saving 20 percent or another amount, reaching that goal may seem overwhelming. Of course, the more cash you offer in down payment, the less you’ll pay in the long run. Here are a few suggestions for ways to meet your financial goals and move toward owning your own home.


Eliminate credit card debt

If you’re carrying balances on your credit cards, pay them off as quickly as possible. Getting out of debt could boost your credit score and lower your debt-to-income ratio, which could improve your chances of qualifying for a mortgage.
There are several methods to pay off your credit cards:

  • Snowball your payments

This concept uses the analogy of adding layers of snow to create a snowball. Start by making the minimum payment on all of your cards, except for the one with the lowest balance. For that card, pay as much as you can every month. When you pay it off, move to the next balance and pay the minimum payment, plus what you were sending to the first card. Repeat.

  • Pay off the highest-interest-rate debts first

Similarly, make the minimum payment on every card, except the one with the highest interest rate. Pay as much as you can on that one. Once it is paid off, move to the next highest. Repeat. This is referred to as the avalanche method.

  • Consolidate your balances on a zero percent credit card

If you have a good credit standing and a plan to repay your debt in a short amount of time, get a reprieve from interest by transferring your balances to a low- or no-interest card.
While you dedicate yourself to paying off existing debt, be sure not to take on any more. You may want to stop using your credit cards completely until you break even. Avoid temptation by removing your cards from your wallet.

Build your credit score

If your credit is low or non-existent, build it up. There are several ways to do this. Start by reducing debt and making your payments on time, consistently. With careful planning, you can boost your score significantly.

Find money

Saving money doesn’t always take hard work, especially if you are open to changing your living arrangements. You could find a roommate, move back in with your parents, or find a cheaper place to live. Here are some other small ways to “find” money:

  • Put your tax return directly into your savings account.
  • Adjust your tax withholdings to give you more in your paycheck and less in your yearly return.
  • Place auto-payment memberships like the gyms, video-streaming services, and weight loss programs on hold or quit them. You may be surprised how many auto payments you have.
  • Quit cable TV.
  • Move your money to a no-fee bank account.


Get a (second) job

Depending on your schedule, this option can help you put away a lot of money quickly. Think about your skill set and how you can translate it into a side hustle. Get creative: your options may include babysitting, blogging, or driving for a ride-hailing service like Uber or Lyft.


Sell your stuff

Clean out your closet and earn extra money at the same time by hosting a yard sale or selling items online. Decluttr, Tradesy, and eBay are all sites that make it easier than ever to sell items online.


Edit what you spend

If you want a better idea of what you’re spending each month, there are a wide variety of financial apps available for just this purpose. Using one of these programs can be an effective step toward cutting back on the small luxuries we all indulge in, like lattes, trips to the nail salon, and professional car washes.

Once you know what you are spending, you’ll be in a better place to judge what you can live without until you meet your goals.

Saving for a down payment may take some sacrifices right now, but don’t forget: these temporary measures will help you work toward a worthwhile goal. All those nights of eating in and cutting out luxuries will pay off when you get that first set of keys.
Serena Miller is an Atlanta real estate agent for Owners.com, where the process of buying and selling your home is made simple. When she’s not working tirelessly for her clients, Serena tries new restaurants and travels with her two adult daughters. She also takes care of her home by tackling home improvement projects like tiling and painting.