Are you one of the many Canadians finding it difficult to save for a down payment to purchase a home and wondering why setting aside money is such a challenge? Let’s have a look at some reasons why you might be finding it hard to save money along with provide some help with fulfilling your dream of owning a home.
- You Like to Eat Out Too Often – While it’s nice to have someone else do the cooking and dishes in our busy lives this habit can really take a bite out of your wallet. Take a couple making more than $200,000 in combined income that spend over $1200 a month eating out while their mortgage payment is less at $1129. That adds up to a whopping $14,400 a year in restaurants and almost 7% of of their annual income! Another interesting fact is that in 2015 the average Canadian family spent $2502 in food purchases from restaurants.
- Using Credit Irresponsibly – Credit purchases can earn you points or cash back, however using credit to buy a $1000 jacket or an expensive car that results in your bills not being paid on time is not a good idea. It’s important to distinguish between wants and necessities, when it comes to credit understanding the basics is all anyone really needs.
- You Don’t Have a Budget – Taking time to prepare a monthly budget is quick and simple and allows you to track expenses and income. For some people, this is also a great way to have a clear picture of where the money goes and where some cuts might be necessary.
- Financial Goals – Whether it’s saving for a down payment, paying off credit card debt or saving for retirement, determining long or short term goals should be part of the financial plan.
- Saving Automatically – Pay yourself first is an expression we’re all aware of and yet usually savings consist of whatever is left at the end of the month. Setting a realistic goal of 10% of your gross income is more doable than 30% and can be set up as an automatic deduction each month.
Reviewing your spending habits and making a few changes will have you well on the way to increasing your savings in no time. If you are having troubles finding enough money for a down payment, contact me today to see how I can help.