No matter where you live, saving for a new home can be overwhelming. It’s likely the biggest purchase you’ve ever made and you may not be sure how to get there. The good news is starting can be as simple as downloading an app. Budgeting apps are a popular way to keep track of your money and reach your goals. It’s easy to see why.
"I don’t spend that much at Starbucks every week." Or "I only eat out twice a week." But when you use a budgeting app you can see it all in black and white. You’ll know exactly how much you’re spending on fancy coffee and you can see that, if you count lunch, you actually eat out every day. Most apps will even break down your transactions into categories, so you’ll be able to see if you’re spending 50 percent of your money on new clothes or going out with friends. Seeing where your money’s going is the first step to deciding if that matches with what your priorities are.
Once you’re honest with yourself you can start to see what expenses are truly necessary, like rent, groceries, and credit card debt payments. Once you know what you absolutely have to spend each month, you'll know how much money you can put into savings. Your app can also help you figure out what to do with any unexpected money that comes in, like a bonus or a raise.
Chances are you have an idea how quickly you would like to be in your new home. Now it’s time to do some research on how much new homes in your area cost. Once you have an idea of how much it will cost for you to buy your new home, you’ll be able to calculate how much you have to save each month in order to reach your goal by your deadline. Don't forget to add in expenses like closing costs into your estimate!
Now that your budgeting app helped you figure out what you have coming in and what absolutely has to go out every month, you can get a better idea how much you can save and how quickly you can reach your goal.
You’re getting there! Now that you’re using an app to keep a close watch on your budget, you can see the progress you’re making every month. Seeing the needle moving toward your goal is great motivation to keep at it. You’ll be in your first home before you know it!
It doesn’t matter if you’re saving for your new home, trying to pay off debts, or just trying to take control of your finances. Having a firm grasp on your budget can help you get there. So, what are you waiting for?