Owning a house is a dream for a lot of people, but in order to get there, people need to be smart with their money and also have a plan. My name is Jacques Poujade, and I am the CEO at LendPlus, an alternative lender. A common question I get asked is how to save for that very first home.
I decided to put together the three biggest tips I can think of to really get the ball rolling.
1. Pay Off High Interest Credit Cards.
Credit card debt can get a lot of people in trouble. While it might not seem like a big deal at first, interest can start to really pile up and waste a lot of money in general. Nobody wants to be paying off a lot of interest for months and possibly years. It might be tempting to continue to buy and spend like you normally do, but take a break and make sure that the credit card is paid off in full before trying to move forward.
Not only does paying off the credit card free up a lot of money, but it improves a person’s credit score as well. It shows that you can be trusted now and in the future.
2. Make A Budget and Stick with It.
Every single person spends money on things that they shouldn’t. A big reason why? It is so easy to spend money with credit cards and debit cards that it can sometimes be lost. By setting a budget, a person can see exactly what they are spending and where they can cutback in certain ways.
A monthly budget works well for people who just need a little bit more discipline in their life. With a budget, make sure to include a way to start saving little by little if possible. Every little bit counts in the very beginning.
3. Cut Back on Expenses.
This tip is related to making a budget, but it takes things to another level. Once a budget is set, a person can really start to look at what they can cut back on to save additional money. There are so many ways for someone to cut back spending and save money. One example is taking a hard look at your current vehicle. Do you really need a vehicle the costs hundreds of dollars a month to lease or own? How about the current living situation? Is there any way to get roommates or even move-in with family? It is obviously difficult to give up things you are accustomed to, but this is all supposed to be temporary while saving up for something great.
If just a little bit of money is holding you back, the best thing to look at is eating habits. Even the eating out one or two times fewer per month can help a person save some money. A coffee addiction also adds up monthly. Perhaps you like those expensive workout leggings or shoes. Could you sacrifice brand loyalty to save a few bucks? Just look at how money is spent and go from there.
I realize that saving money is not usually fun, and there are sacrifices that must be made in most cases. Being able to save to buy a first home is such a huge milestone, making it all worth it. For more financial tips, or to simply reach out to me in general, please visit my website www.jacquespoujade.com or follow my Medium blog.