Whether you're looking to buy or to rent, you need to start with the basicssaving for a deposit....
Whether you’re looking to buy or to rent, you need to start with the basics…saving for a deposit. Your deposit is where it all begins on your road to finding a new home however saving for one can be a daunting and sometimes rather large task.
We’ve put together these 3 tips that will help you to save for your deposit and make the journey to your new home a little less stressful.
Do the maths
It’s good to get an independent look at what you can afford, stretching your budget isn’t wise…especially if this is your first deposit you’ve had to finance. An Independent Financial Advisor will help you run through some figures and will be able to advise you as to the best options available for you and how you might be able to maximise your budget to pull together the best deposit you can.
It’s never too early
It’s never too soon to start saving for your deposit, get yourself into a good savings scheme (detailed below) and start dripping money in to it as and when you can, that way you can put money in little and often rather than having to forfeit large amounts of money when you’re in a panic nearer the time. Giving yourself a time frame will help you to have goals and objectives to meet and will save you from saving too little, or even too much because you haven’t been keeping a close eye on your funds.
Pick the right account
Choosing any kind of banking can be a real headache, let alone confusing. Ultimately you want a high interest savings account that’s going to give you more for your money. From April this year you’ll be able to save tax-free in a normal savings account meaning you won’t necessarily need to use an ISA to reap those benefits (terms apply). Take a look at current accounts, too. The 123 account from Santander will give you 3% interest so long as you have between £3,000 and £20,000 sat in your account...that in itself is a great way of saving money as you’ll be aware you need a certain amount in the account to earn the interest each month. Ultimately, you need to read the small print and make sure that you're getting the best deal before signing up for an account.
Overall, you need to be sensible when saving for a deposit, give yourself plenty of time to save and ensure you know the exact goal you need to reach. Avoid living beyond your means…luxuries are nice but could you forego non-necessities for a couple of months to help you save a bit more money?