Tips for Saving for a House as a Couple
Being in a strong relationship means that you get to embark on many of life’s adventures together, as a couple. One big step that couples look to make after finding the person they’d like to settle down with is actually buying the house that you’re going to settle down in.
For young newlyweds, though, the funds might not quite be in place to find a house and put up a down payment, just quite yet. Instead, it’s going to take some time and effort to save up the money to get your first house.
Here’s some tips on how you can work together, as a couple, to do just that…
Use a joint account
First of all, you need a way to handle all of the important finances, such as bills and savings, together. This means getting a joint account. Your joint account should be used to pay for rent, taxes, insurance, maintenance costs, and any other recurring expenses.
Both couples should have access to this account so that they feel like they are both invested in the future of purchasing that shiny new house. This is also a lot simpler than having each person pay different bills, each month.
Pick a “project” house
The amount of money that you and your significant need to save for a new house is largely dependent on what you are looking for in a new home. Obviously, it’s a lot easier to purchase a home in a cheaper neighborhood, or with less rooms.
One option that can save you a lot of money, in the long run, and help you get into your new home, quicker, is to buy a “project” house. This means that there will likely be lots of unfinished components to the home that give it a cheaper price.
One advantage to this method is that it enables you to buy homes with unfinished projects that would greatly raise the home’s value, such as a kitchen that needs to be remodeled, and then finish it yourself. This is a great way to make the most of the investment of buying a home.
Work down other debt, first
Oftentimes, the biggest obstacle to a couple being able to purchase a house is debt. It’s important to approach the mindset of debt as a couple. In other words, your partner’s debt is your responsibility to.
Together, you should find ways to pay down the debt that you both owe as quickly as possible. Lenders that will make it possible to purchase a home are going to look at your debt to income ratio as a major factor of how much they are willing to lend you (if anything at all).
Being debt free shows that you are financially capable, and makes it so that you can go into the world of homeownership without any lingering debt weighing you down.
Cut back on housing costs, now
The key to saving for a new house is to cut down on your monthly expenses so that you are able to put more money away in savings, each month.
For many people, their biggest expense is for rent (indeed, the rent money that is going down the drain each month is a big motivator for homeownership in the first place).
For this reason, if you are planning on buying a house in a year, sign a lease at a cheap place to rent for that year, or look for other ways to pay less in rent. Even if you are scaling back your lifestyle, for now, it will help you get to where you want to be, faster.
Skip the car payment
Car payments can also be a major obstacle in the way of saving money for a new house. For this reason, if you have a timeline to when you want to buy your home, try to avoid buying a car that you are going to have to pay monthly for.
Instead, simply pay cash for a beater car that will get the job done while you are saving money. Alternatively, if your situation allows it, you could forego having a car for the time being and either walk, use public transportation, or even dust off the old bike to get around.
Category: Housing
