Saving money might not be something high up on your agenda, but the reality is that there’s no such thing as being too young to start preparing for the future. In particular, putting a bit of money away each month to save for a home, instead of splurging on sneakers and records is a smart move.
But how to get started? It all might sound a bit daunting, especially if you’ve never considered it before. Thankfully, there are several useful money-saving tips and techniques you can learn, remember, and implement that will help you on your way.
Learn about savings accounts
There are many methods you can use to save but one of the best is in a savings account through your bank. There are lots of different types of savings account available. There are ones where you cannot withdraw your money during a set time, ones with special high rates, and accounts with lower rates and more flexible terms. It all depends on what your end goal is and how long you will be saving for. The best thing is to speak with your bank or a financial advisor to see which kind is the most suitable account for you.
Get to grips with mortgages
Like many new things, the concept of a mortgage can be somewhat intimidating. However, most young adults, first-time buyers, and even older home purchasers will likely use a mortgage to get on the property ladder. A good way to start understanding mortgages, rates, lenders, and other conditions is to compare mortgages on a site like Trussle. Here you can see information on different offers side by side which allows you to compare them and really understand the differences. This can help give some context to the concept of mortgages and help you comprehend what is involved in the process when the time comes.
Make a plan and stick to it
It’s always wise to have some kind of savings plan in place. Take a look at your income each month and figure out what you are spending on rent, food, socializing/nights out, clothes, music, etc then decide what you can save. Usually, it’s wise to put aside a percentage of what you bring in each month, somewhere around the 20% mark. Once you have a plan of how much you will save and where you will put it, the most important thing is to stick to it!
Stop putting it off
Whether you are late teens or early 20s, it’s never too early to start saving. Stop putting it off by saying “I will start when I’m older” because that time will be here before you know it. A motivator could be that each day you put off starting saving is a day longer you will have to wait for your first home or another major goal.
Get rid of any debts
Except for student debt, it should be high on your list of priorities to clear any other debt such as credit cards or overdrafts. It can be quite difficult to clear and of course, it’s nice to have something to fall back on, but it can also affect your future financial situation if it’s not handled sooner rather than later. Stop resorting to credit lines and pay off enough to cover interest and some of the balance each month. If you are really stuck, there are consolidation services out there that can mean you only pay one single payment each month, instead of several.
Saving might not be fun the most fun thing to do with your money and living life to the full is important, but saving up is still a definite necessity. Once you get going, those savings mean that there are lots to look forward to and achieve in subsequent chapters of your life.