Track your spending then create a budget
- When you track exactly where your money goes each month you can see where you can keep some cash each month to put into savings. You can use a tool like the Government’s ASIC MoneySmart TrackMySPEND app to work out where you’re spending at the moment.
Commit part of your monthly income straight into a savings account
- Out of sight out of mind, is a savings strategy that can work well. You can do this by transferring a set amount that you have budgeted to your savings account and the amount you have budgeted to cover daily expenses and bills into your regular account. That way you help yourself stick to your budget and your savings are safely out of temptation’s reach.
- Wondering how much to save? The 50-20-30 rule recommends that ideally 20 percent of your income should go towards Savings, the balance 30 and 50 percent contribute to Your Wants and Must-Haves respectively. But then again – every person’s situation is different, and that might not work for you. The important thing is that a regular amount of savings, whether it’s big or small, gets put aside. It will eventually add up and help you achieve your goals.
- The ASIC MoneySmart website also offers some other ideas about how to save your deposit.
The importance of showing a lender you have made regular savings
- Another good motivation for saving into a separate savings account for your deposit is that lenders usually want to see what they call ‘genuine’ savings. Basically they want to see that you can manage your money well. If you have savings that are considered to be non-genuine (like an inheritance) you may still be able to use those funds if you put them into a savings account where they are left untouched for an amount of time – usually a three-month minimum.
If you’d like to know more about the deposit amount you need, including options on deposits for less than 20 percent, have a chat with us to see how we may be able to help. Talk to us today on 0434391331 or click here to get in touch.
