How to save a deposit for your first home

How to save for a house deposit

Homes, they’re pretty damn expensive right?! You’ve got a huge deposit to save up, but not only that – there’s lots of fees, furniture to buy, bills to pay… Okay, so before I depress you any further, today I thought I’d write up a little post to help anyone who is looking to save up for their first home by sharing my story and tips.

My back story…

Around the age of 17 I remember thinking “I want to save my money towards buying my first home” …I know, what a grown up thought to have a such a young age, but d’ya know what? It worked! Back then I was still in education and was so until I graduated when I was 21. However, along the way I saved up all the pennies I could and it seems to have done the trick.

Since leaving uni I’ve had various jobs at varying levels of salary (I’m no millionaire FYI) and I was lucky enough to live quite cheaply with low rent and bills to pay whilst I was living with my parents prior to buying. Fast forward to 2015 and I was able to buy my first home by myself with a relatively big deposit meaning my monthly mortgage bill isn’t as scarily big as it could be – win!

So what did I do to get there?!

During uni there were two “uni-specific” things that helped…

The first was to “stooze” my overdraft. Stoozing is where you take out some of your 0% student overdraft and you plonk the money in a savings account to earn interest on it. Basically, stoozing = free money! “Wait. What? You didn’t use your student overdraft?” Uhuh! Strange right? Obvs I’m no money expert so *please* research this thoroughly before doing this and be very honest with yourself in terms of whether this works for you. But if it does…happy days!

I stayed at my parents home during uni. (Thanks mum & dad!). My uni was just a half hour drive from home, so I saved stacks of cash by not paying out for student accommodation. “But didn’t you miss out on all the partying?!” I hear you cry… Nope! Actually a few of us on the course drove in like I did, so not everyone was out partying with uni friends. Let’s just say I back then I’d usually be found at a rave on the weekend, so I definitely didn’t miss out on my partying years! I still can’t cook though…

 

Obviously the above won’t work for everyone, so here’s a few more tips to help kick start things… You’re welcome! :)

Check your bills – where do you spend money? Make cut backs! e.g. I made sure I had the cheapest phone bills, made do with using my mobile a bit longer before upgrading etc. and made sure I didn’t start paying out for anything I didn’t really need. Think in a “make do” kinda style and it’ll help.

Your salary – ohh, the subject that everyone seems afraid to talk about. I mean how dare you ever expect your salary to go up at all so you can still afford to buy all those things in life that are going up in price… Yeah, exactly. Your salary matters. I’m not saying only consider £100k per annum roles (ha!) or go running out of your current role, just be aware of your value, your experience and what is potentially available for you. After all, we have jobs to pay our bills and enjoy life right? So why is it so taboo? I’ll leave you with the fact that from my first job to my second I managed to get exactly 50% extra annual pay…

Clothes – check out the cheaper stores. If I had a piece in mind, I’d try to find it in the more affordable stores first before trying others. Or simply try to say no more often! Dig out that will power if you can!

Food – going out for a meal? Always check online for offers first. There’s often vouchers to print or codes to show on your phone. Take a peek at your apps like the o2 priority app which always features restaurant offers. Or again…say no! Fix up an extra yummy but much cheaper meal at home. When it comes to food shopping, I always check out which is the best price and I’m happy to buy basic range products as long as they’re still healthy and taste okay!

General shopping – it’s always a good idea to sign up to the loyalty schemes for the stores you shop in most often. Yes, it’s bloody annoying carrying around all those cards, but hey it’s practically free money and every little helps!

Sell! Sell! Sell! Do a huge declutter of all your stuff, not only will you feel great for doing it but you’ve probably just uncovered a whole load of lovely bits that you could make money from. If you’re a selling newbie, I’d suggest checking out eBay, Facebook selling groups, Gumtree and selling apps like Shpock which is my current personal fave. Take a look through how they all work and see what works best for you. You’ll be surprised what sells!

Christmas – I know! How dare me mention that C word in April! But think about it, when are people most skint? Just after Christmas right? So when it comes to Christmas here’s what I do to save money… 1) Write a list – make sure you know who you’re buying for, how much you’re spending, what you want and tick them off. 2) Start to buy earlier, it’ll give you time to check the sales out and grab a bargain on the run up to the big day – plus you’ll be super organised come December. 3) Use up those loyalty points that you have hiding in your purse – it’s practically free money! 4) To be prepped for the next Christmas, buy your cards/bags/wrapping (heck even some gifts!) in the January sales – they’ll be 1/2 price or less!

Birthdays – Just like Christmas, birthdays can be quite expensive too especially if you have lots of people to buy for! Shop the sales for lovely gifts and stash them away ready for upcoming birthdays. That £3 card might look lovely…but it’ll be displayed for a week then thrown in the bin most likely! So check out the cheaper card stores, you might be surprised by what you find.

 

Once you’ve saved…

Okay, so you get the jist. Watch your money, see where it goes, cut back and say no where you can – you just need to apply that to everything really whilst still actually enjoying your life obviously! So now you’ve built yourself a tidy little sum, what do you do with it?

Savings accounts right now are pretty rubbish, but I’d suggest taking a look at ISAs, especially the newly announced Help to Buy ISA (if you’re genuinely interested in buying a home).

I’ve also taken a punt with stocks and shares over the past few years which have given me a much better return on my savings than any savings account. However, there are risks involved with this and you can end up with less than you put in, so read up and decide what’s best for you. (You can choose low, medium or high risk ones etc.)

Also, it’s worth checking out the different schemes out there to help people get on the property ladder. For example you can choose shared ownership schemes where you buy a certain % of a home and rent the rest. Again, it’s all things you need to research into before taking the plunge. I bought a 75% share home before “staircasing” (going up) to 100% as soon as I was allowed to step up, as my main personal aim was to own all of my home and not pay any rent if possible. I was able to do this by myself thanks to my saving determination, so without wanting to sound boasty or big headed, it definitely works! I just hope my saving/home buying story inspires others to give it a go.

Just arm yourself with lots of knowledge and think savvy, because the more you save the better your position will be. It doesn’t matter whether you buy a 25%, 50%, 75% or 100% share – put simply, the more money you can pour into a mortgage instead of renting the better!

So go! Go! Go! Get saving and making your dream come true! :)

(P.S. I’d highly recommend taking a look at the Money Saving Expert website, which is super useful for advice on money, home buying and so much more. Plus, you can use their forums for extra help from other users.)

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