First mortgage – steps to saving

The property market is in good shape. Prices continue to rise and sold signs are popping up like mushrooms. This is all wonderful news and we’re all going to be property-rich.

Spare a thought for the first time buyer! Gaining that elusive first step on the ladder must seem in insurmountable task. Would-be homeowners have to save for a considerable length of time, as the average deposit is now around £12,000, having risen from around £4,000 ten years ago. Small wonder the average fist-time buyer’s average age has risen to 34.

What simple steps can you take to get yourself into a “saving mode”? It’s no use being unrealistic; it’s going to take a long time to get there. Short of winning the lottery, there are not short-cuts.

It would be a good idea to do some sums – try to work out how much deposit you can realistically achieve and get some idea of what repayments you could afford. This will give you an idea of the price range of the property you’ll be looking for. Gradual changes to your lifestyle will be easier to accomplish, rather than dramatically changing your way of living. It’s easier to sustain small changes over the necessarily longer term.

Look into all your recent expenditure. By making a record of all your outgoings, you may pick up on things that you may have been wasting money on and therefore discover ways to spend just a little less each month. Pop any money saved to one side. It’ll soon accumulate and add to your savings.

There are all sorts of ways you can save from day to day. Maybe you’re in the habit of popping into the station café for a coffee on your journey to work – do you really need it? If it’s pure thirst and not just habit, carrying a small bottle of water will do the job just as well, and tap water at that! If drinks are not provided at work, or for working away from base, a flask of coffee is easily prepared at next to no cost. You could probably save around £60 per month on this alone, which is well worth doing.

Similarly, pre-packed sandwiches can be amazingly expensive – and does it stop at a sandwich? Pack your own sandwiches, even using prepared fillings from the supermarket and you’re on your way to saving over £80 per month.

What about your direct debits? Look down the list to see if you really need the little extras you’re paying for, month after month. It’s easy to stop these expenses, just stop the direct debits and you’ll probably not notice the difference, apart from in your bank account.

Keep an eye on the everyday bills. Be energy conscious, making a point of switching off lights in un-used rooms. Leaving appliances in stand-by mode can eat away at your electricity bills and do you really need the heating to be quite so hot? If you pay your yearly bills in advance for items such as car and home insurance, you could get a discount, and save yourself money overall.

You may have credit card debts. By transferring any debts from these to a card charging zero interest the money paid off will be against your balance and the account will reduce, rather than simply paying interest.

There must be many more ways to save. Think about it. Check the internet to see what savings accounts are on offer. If you open a high interest savings account, or maybe consider a tax-free ISA, you’ll be well on the way to long term saving – and that first home of your own.