If you’re planning on buying a home, having a larger down payment has many benefits. Below are 5 ways you can put a little extra cash* in your down payment savings without doing much at all! (*Actual savings will vary depending on your individual circumstances.)
1. Cut Cable
Could 2015 be the year you dropped cable? It’s something to consider. The average household is expected to pay $123 per month on cable in 2015 and costs are rising by 6% annually. Netflix and Hulu offer a similar service for a fraction of the cost. Netlix streaming clocks in at $8.99 per month and Hulu at just $7.99 per month.
Bonus Tip: If you’re an Amazon Prime member, you already have access to their extensive video library for free.
Estimated Annual Savings (Netflix): $655.04
Estimated Annual Savings (Hulu): $677.04
2. …And Cut Other Services Too
On the flip side, if you’re content with cable, do you really need Netflix and Hulu? What about HBO, LinkedIn Premium, magazine subscriptions, satellite radio, streaming music services, your home phone, gym memberships, or those “pro” accounts you rarely use? These various monthly fees can pile up. Cancel the ones you don’t need and see your savings add up.
Estimated Annual Savings: $96 to $1,000+
3. Brew at Home
If you regularly stop for coffee in the morning or afternoon, you’re making a large dent in your wallet. A $2 cup of java each workday amounts to $502 over the course of a year. Whether you have a single-cup brewer or an old fashioned drip machine, brew at home for a cheaper caffeine fix.
Estimated Annual Savings (Single-cup): $376.50
Estimated Annual Savings (Drip Machine): $476.90
4. Stop Eating Out
Just like coffee, eating out can be an expensive habit. Whether it’s grabbing lunch daily or dining at a restaurant twice a month, watching where you eat may lead to big savings. As you pack your lunches or skip those trips to wing night, watch your mortgage down payment grow.
Estimated Annual Savings (Not Dining Out): $360.00
Estimated Annual Savings (Packing Lunch): $627.50
5. Revaluate Your Car Insurance
A few years ago I bought a new car and my insurance fees went through the roof. Horrified, I went shopping for a new insurer and found equal coverage for what I was paying for my 10-year-old vehicle. A recent survey found an average savings of 32% for those who switched car insurers.
Bonus Tip: Look beyond car insurance and see if you can save on your cell phone plan or homeowner’s insurance.
Estimated Annual Savings: $483.20
Total Estimated Annual Savings: $1,970 to $3,624
When embarking on your savings journey, make sure you’re moving the money to a place you won’t spend it. Our advice? Set-up an automatic withdrawal from your paycheck in the amount you’re saving each month. You’ll never miss it!
Curious how we calculated our savings? Comment below and we can talk numbers!