Saving for a home deposit can be difficult at the best of times, sometimes even harder for those who are self employed. Here are some tips to help you to save for your dream home:
- Save more in prosperous months: Keep sight of your bigger goal of buying a home. If you have months where you have earned extra money, consider opening up a savings account that gives bonus interest and setting aside the extra money. Every bit of savings can help!
- Set a goal for your home deposit: Work out how much your need including stamp duty and legal fees. Aim to save at least 20% of the property value to avoid paying lenders mortgage insurance (LMI).
- Be smart about your tax deductions: Self employed may be able to claim for tax deductions related to business. Speak to a qualified accountant for information about what you can claim. An accountant is a worthwhile investment to ensure you make the most of your tax deductions.
- Save a percentage of your pay each month: Consider using a budget tools such as the 50-30-20 budget, 50: the must haves, the necessities such as rent, groceries and utilities, 30: the wants, entertainment, clothes, 20: savings and debt
- Protect your income: Should you be in a situation where you are unable to work due to an injury or sickness, income protection insurance may help cover for the income lost during that period which means you won’t be using your house savings for daily expenses.
Have you saved what you need for a deposit and are now looking to buy your dream home? Speak to us at Tundra Mortgage Brokers to find the right loan for you!