If you're looking to purchase a Long Island house soon, you'll want to start saving for your down payment. As a general rule, if you are able to put down a 20% deposit, it will save you a lot of money in the long term.
Yes, there are loan options for lower amounts, but when you have a 20%, you generally are able to secure lower interest rates, and that will reduce your payments for years to come. Second, this can help you avoid the need for Private Mortgage Insurance (PMI) and that can save you a lot more. And, third, if you put down a larger deposit, you are paying interest on a lower base.
So, here are a few tips to help make saving easier.
1. Get a savings account. Get a higher interest savings account (as this will allow you to increase your money while it sits in the bank). Be sure that you have the ability to withdraw your money when the time is right.
2. Automate savings. So, this could mean that you take out a certain amount (or percentage) of each payment and deposit into your savings account. This will make sure that you are consistently saving.
3. Look at your budget, and determine where you may be able to make cuts. Look at your monthly budget to see where your money is going (especially monthly bills) and see if you can trim or eliminate some. Do you need cable? Or can you cut back on it? Can you shop around for less expensive items (e.g. car insurance, cable, gym membership, etc.) Can you save on your groceries/use more coupons? Are you going out to dinner or Starbucks? Can you bring your lunch rather than go out for lunch, etc. Can you share expenses with a friend? Can you add a roommate? You get the idea. Brainstorm.
4. Look for ways that you may be able to bring in more income. Can you work more hours? Can you start a side hustle? Can you get a raise? Can you charge more for your goods or services?
5. When you get tax return or other "windfalls," deposit these in your savings account. These could be birthday presents, wedding gifts, bonuses from work. Be disciplined with these extra gifts.
