Rethink Group Have Some Great Tips for Saving For Your First Home Loan

This may sound a little simplistic, but the best tip you can be given is to save 10 per cent of your pay each pay cheque. Designate one savings account – ideally at a different bank to your everyday accounts to make it harder to access the money – and then transfer 10% of your net pay each pay period. It might mean you have to miss out on a few restaurant meals or coffees throughout the month, but it will be well worth it in the long run.

Another idea is to look to make voluntary KiwiSaver contributions and benefit from the compounding investment returns. However, Rethink advise you only use this option if you qualify to withdraw your KiwiSaver balance to purchase your first home i.e. been a KiwiSaver member for more than three years.

An obvious way to save is to pay off your debt. Paying off your debts makes sense for two main reasons: it will increase the amount of money you can borrow, and it will free up cash to put towards your home loan repayments. Similarly, with eliminating luxuries. You can start by removing or downgrading personal luxuries and directing the money into a savings account. You don’t have to skip everything at once, instead, remove one luxury per month, pocket the savings, and then move on to the next one.

For instance you could cancel your Sky television or favourite magazine subscription, take your lunch to work instead of buying it, and avoid online shopping. Finally, if you’re serious about saving for a home deposit and your finances are already stretched to capacity, then consider looking for extra work. By working a few evenings a week, you could easily add $1,000 a month to your bank account, or $12,000 over 12 months. Think babysitting, dog walking, freelance writing or graphic or web design, tutoring high school students or teaching English to foreigners.

For a free personalised consultation, and for more information on debt consolidation, home loan calculators,  non bank mortgage lenders NZ and Kiwisaver homestart grants please go to https://rethinkgroup.co.nz .