It’s a challenge many of us face today: how to pay rent, keep up with bills and live your best life, all while storing away enough for a home deposit.
Saving money takes time. But if putting enough away for a home deposit is your goal, we know a few tricks to get you there sooner.
Start with a real goal
Saving money is great, but without a clear goal, you’ll either end up saving forever or never save up enough for the thing you really want. Do your research to determine a reasonable home deposit for the type of property you want. Set a dollar amount you’d like to save and a target date.
You can use our handy online calculator to help you figure out what kind of loan your rental payments could get you.
Create a budget and stick to it
If you’re like most people, you spend a lot of your time and energy earning your money. But do you know where you’re spending it? Managing your spending is key when you’ve got big goals to kick.
Having a budget is going to help you divide up your money. Once you know your savings goal and have reviewed how you spend your money, you’re most of the way there!
Tip: A good way to plan your budget is to align it with when you get paid. So, if your employer pays you fortnightly, then dividing up your spending fortnightly could be best.
Slim down your living expenses
Big-ticket items like rent, food and bills are non-negotiable, but there are ways you can trim costs from your daily expenses. Could you move to a cheaper suburb, get a roommate or even downsize to a smaller rental while you save?
Boost your income by selling what you don’t need
You might even be able to pick up some food delivery or rideshare gigs or turn one of your hobbies into a burgeoning side hustle.
Make your money work for you
Want to give your savings some growing power? Open a high-interest savings account to unlock bonus interest and supercharge your moolah. This way, you’re not only removing any maintenance costs on the account, but you’re also building your savings without having to do anything. It could also help to find a savings account that’s online only.
Doing this will mean you won’t have a debit card attached to the account, which makes your money less accessible. This should incentivise you to save more!
Automate your savings
A simple but effective way to boost your home deposit savings is to set up a recurring, automatic direct debit from the bank account your income is paid into to your savings account.
By automating your savings, you won’t be tempted to spend any money that you had planned to set aside and save, because you won’t even see it on your account on payday.
Round up those savings
Another small – but great – way to increase your savings is to set up a bank account with a round-up feature. These features work by taking any ‘change’ from a transaction you make from your bank account and putting it into a savings account. Round-ups won’t amount to massive money over time, but every little bit helps save towards a home deposit.
Save up an emergency fund
Life happens, and having an emergency fund is a great way to protect you against any surprise costs. Along with putting money aside for your savings goal – whatever it might be – it’s worth putting a portion of your money away specifically for emergencies.
Your car might need urgent repairs, or you could need to book flights to see family on short notice. This way, you won’t have to rely on getting a loan or a credit card that could put you into debt.
Rent.com.au is Australia's largest company dedicated to renters and is owned and operated by ASX-listed Rent.com.au Limited (RNT:ASX). For over 15 years, Rent.com.au has exclusively focused on making renters' lives easier by making it easier to find a property, secure it, move in and pay rent.