5 Steps to Save For Your First Home's Down Payment

Step #1: Set a plan

Knowing how much money you bring home every month and where it is going is the key to saving for your first home's down payment. You’ll want to analyze a few of your bank statements and compare your necessary spending to your non essential spending. You need to see where you can cut out spending. For example: if you’re eating out too much, cook at home more often. If you are a frequent flier at the local coffee shops, consider making your coffee at home. Small sacrifices will pay off when you are sitting in your new home! 

Step #2: Save

Next open a bank account specifically for your home savings, where you can automatically deposit a set amount monthly and FORGET it’s there. You have to look at savings as a non negotiable, like your water bill or cell phone bill. 

Step #3: Consider making extra money with a side hustle

Do you have a skill you can put to use in order to make extra money? Do you know another language and can tutor on the side? Can you do work a couple of hours a week, after your regular 9-5 for Shipt, Uber or Lyft? Finding a side hustle that will provide extra income will get you to your savings goal faster.

Step #4: Downsizing

If you currently rent, consider downsizing to a smaller apartment in order to save more money. If you own a lot of stuff can you sell what you don’t use and add that to your home savings account. Declutter your home, have a garage sale or sell on eBay or Facebook Marketplace.

Step #5: Get rid of your high interest debt

Use the snowball approach to start knocking out debt. If you can, pay off your smallest account with the highest interest rate first by sending more money each month towards that specific debt. Once that account is paid off, you simply apply the monthly amount you were making to the next account you plan to pay off. This approach will help in multiple ways:

1. Paying off debt will allow you to qualify for a higher home loan amount. 
2. When you finish paying off most of your high interest debt, you can send the amount you would be sending monthly to your payments straight to your down payment savings account - remember - the one you just opened up to accomplish this goal!

Questions? I'll be happy to schedule a call with you at your convenience to answer any additional questions you may have.

Carmen Buenrostro

Real Estate Broker | Co-Founder

Silverback Realty, LLC

San Antonio & Surrounding

C: 210-712-9068

carmen@silverbackrealtysa.com