By far, the biggest hurdle to purchasing a home in NYC is figuring out how to save for a down payment. In many instances, it can be a six figure undertaking. That’s a tough feat to accomplish, but it’s certainly not impossible, especially if you follow some of the tips below.
Set up a budget and figure out where you can cut costs and divert your cost savings to your down
payment. Yes, this is advice you’ve heard over and over again. But there’s a reason for that. It’s because
it works. When people actually sit down to do this, they’re generally shocked at how much money
they divert elsewhere each month.
Learn how to invest. This is the single BIGGEST thing you can do to turbo charge your savings. A
regular savings account isn’t likely to cut it these days, due to the super low interest rates. Investing, on
the other hand, can be a game changer.
Hire a financial advisor. This can be especially helpful if the idea of investing is intimidating to
you. Just be sure you understand what to look for to help you find a good one!
If you have the time (and the energy), consider creating a second stream of income. Sell things on
eBay, Etsy or Amazon, or perhaps offer freelance services.
If you’re currently living solo, you might want to consider getting a roommate. It’s certainly not the most glamorous of options,
but doing so could potentially save you thousands of dollars a year.
Set up automatic savings transfers and consider enrolling in banking programs which round up purchases to the nearest dollar and deposits the change into your savings account. Or better yet, your investment account. You’d be amazed at how much you can save within a year!
Check your interest rates on credit cards and student loans to see if you’re truly getting the best rate. If not, see what you can do to lower it. Again, you can divert any cost savings towards your down payment.
Got a big tax refund, a sizeable bonus or cash gifts from your wedding? Put most (if not all of it) aside in savings or your investment account.
Consider signing up for a cash back rewards credit card. You can put the cash rebates into savings, rather than spending it. But be careful – you don’t want to have too many open lines of revolving credit, so use this option wisely!
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