Tuesday, January 9, 2024 / by Sonya Reiselt
You may have been already thinking about buying a home in the Lowcountry, but now you're not so sure if you can save up enough for that down payment. But there are ways that you may be able to use to wiggle more money from your budget into your down payment savings. All you need to do is adjust some of your daily habits. You need to find things you can "skip."
Everyone's “discretional income” varies depending on their situation. What are some adjustments to your discretionary spending that you can make? Here are a few suggestions:
Skips the Starbucks
A Grande Latte at Starbucks costs about $3.65. If you add that up to five times every week, it really can add up. Even just getting a regular Grande coffee costs $2.10. At that rate, you're spending $500 a year just on coffee alone. You could buy your own cappuccino machine and still save money making your own. And who knows, it may even taste better!
Skip the lunch out (or delivery)
You may think that since eating lunch out or getting delivery is cheaper than dinner that you're not spending so much. But just like with coffee, those $5 and $10 meals all add up. Doing the math, we see that eating out 5 times a week can cost around $50. Over a year, that's $2500. Add that to the coffee expenses, and you could save up to $3000 if you just stopped with these two suggestions.
Now let's get to dinner. If you spend $50 a week eating out twice a week for dinner, you now have another $5200! If you compare that amount with a 3.5% down payment on a home that costs $222,000, and you almost have the $8000 you need. Right now, just doing without Starbucks, and eating out for lunch and dinners, you can have most of your down payment saved in just a year! Or you can spend that money on sandwiches and pasta. Your choice. But owning a home is a better investment.
Skip the car wash
Do you clean your car at the car wash or at home? The average price of a car wash is about $7. Is just cutting out this activity and washing your car at home going to get you that down payment? Of course not. But every little bit helps, and the $364 you’ll save after a year of weekly washes can put you over the top or give you a cushion should moving expenses exceed your budget.
Skip the cable
Are you still watching TV on cable AND paying for internet? All you need is just high-speed internet and a streaming TV subscription, and you can save hundreds or more in a year. An Amazon Prime plan costs $99 a year, a basic Netflix subscription costs $132, and Hulu costs $96. Even if you spring for all three choices, you'll still only be paying $327 annually, saving you about $875 if you're a former cable subscriber.
Saving money for a down payment takes time and discipline, but if you use these tips above, you can be in your own home in Beaufort before you know it.