Balancing Deposit Savings with Enjoying Life: Strategies for Financial Success

Saving for a house deposit may seem like the start of adult life, but with an optimistic approach it needn’t be!

Saving for a house deposit can feel like a never-ending, tedious journey. Indulgent drinks with friends, delicious dinners with loved ones or movie tickets may fall outside your budget and become impossible.

But what if we told you it didn’t have to be this way? While saving for a house early can help (particularly if living in the city), so can living your life and enjoying both elements simultaneously.

Budget, love
How quickly you save a deposit depends on both your income and expenses – specifically maximising one and decreasing another. Mortgage Choice broker Tim suggests prioritising spending control as part of the solution to ensure fast savings.

“Take three months of your daily savings account statements and isolate must-spends and discretionary-spends,” advises Leite.

Once this step is completed, the next step should be to cut any unnecessary spending and establish a budget plan.

Budgets can range from detailed (for instance, you have $25 each week for coffee and treats) to more general plans that allocate a percentage of income into various accounts: savings, emergency (should your car break down or you require dental work) and everyday.

Tim asserts that keeping to your budget is even more crucial.

Tim advises his clients to be as strict as possible when developing their budgets. Once you’ve created their spending plan, make a commitment with themselves or their partner not to touch this savings account at any point in the future.

Tip: Tim recommends reviewing your budget periodically to ensure it aligns with both your situation and goals.

Are You Tired of Hearing Advice About #LifeoverAgain?

Budget for “fun” Spending is emotional. If you try to eliminate all things that give you pleasure from your budget, chances are good you may give in and make impulse purchases to make yourself feel better. Tim suggests including “fun” into the budget in order to avoid going on an unnecessary spending binge.

Tim advises being creative and focused on what brings you the greatest pleasure in life, rather than looking solely to fancy restaurants for dates or social events with friends. Instead of going to a fancy restaurant on dates or social events with friends, be proactive when making plans and limit spending by going to see local bands instead of eating out at fancy restaurants – not stopping the good life but learning to say no more frequently when saving for a house; consider having BBQ’s with your friends on weekends on the foreshore where everyone brings their own food and drinks — much cheaper than going out at restaurants.”

Tim suggests creating additional revenue streams by working an extra shift every week or taking on part-time work – this can do wonders for your deposit.

If this contradicts with your concept of living, get creative. Perhaps you are an accomplished writer or mechanic and could leverage them by selling services through sharing economy platforms like Uber. Unskilled? Why not attempt KonMari-ing your possessions before listing items for sale on Gumtree or eBay. Finding something you enjoy doing while creating side hustles will not feel like extra work.

Tough Love
Saving for a deposit while enjoying life’s pleasures can be done; all it requires is some creative thinking and shifting your priorities accordingly.

“Consider what matters more: spending lavishly on night out or purchasing your first home? Now is the time for sacrifice; my motto in life is that ‘what’s hard is easy and easy is hard. If you do the hard work now and later it will make life much simpler; conversely if you opt for fun now it may mean serious financial pain down the line,” suggests Tim. You can still have plenty of enjoyable memories without breaking the bank,” according to him.

Are you seeking additional guidance when purchasing your first home? Try Mortgage Choice Financial Fitness Boot Camp, a free online education program tailored specifically towards home buyers.