So, you’re ready to make the big step towards buying your own house – but that down payment is killing you. It can be difficult to save up that much money, but not impossible. Thankfully, there are a lot of ideas that can help you save up for that down payment, so that you can get your dream house.

1.   Pay off your debt

Before you can even think about saving, you need to start thinking about paying off any debt you may have. Here’s why – as long as you have debt, you’re going to be racking up even more in interest charges. And there’s really no point in putting money aside, while you’re paying more in interest fees every day. Focusing on paying off debt should be your first step, and here are a few tips:

• Pay your loan instalment first or set up a direct debit

This ensures that you pay off your necessities right after you get paid, so you don’t even get a chance to spend it on something else. It’s a good strategy, because it literally leaves you no choice, but to pay off your debt.

• Divert money from your impulse purchases to paying off debt, instead

This one requires a bit of self-control, but it’s a good lesson in curbing your spending – every time you want to buy something you don’t need, take the money you would have spent on that and put it towards paying off debt, instead. You’ll be surprised at how it adds up.

• Leave your student loan alone

Surprisingly, paying off your student loan is actually a bad idea. Here’s why – not only is the interest rate small enough that it doesn’t make a massive difference, but the instalments are small, and it also gets written off after 30 years, anyway. So, putting money towards paying this one off doesn’t actually make any financial sense.

2.   Set up a budget

You knew this was coming, and you can’t escape it – you need to start budgeting; and The Money Advice Service can help! No one’s ever been a die-hard fan of budgeting, so it’s understandable if it’s difficult for you. It can be a hard adjustment to make, but not an impossible one. More importantly, it’s a necessary change in your life, and one that’s going to pay off big in the long-run.

Here are some techniques that can help:

• Use a budgeting app

If you find it hard to budget, technology is coming to your aid; the Balance has a helpful list of apps built especially for that. Whether it’s tracking your expenses in real-time or helping you divide money between different kinds of expenses, budgeting on the go has been made easy.

• Track your expenses the old-fashioned way

Of course, that doesn’t mean that the old spreadsheet or pen and paper aren’t handy. It may be easier for you to just write down your expenses and cut back.

• Use envelopes

A really good idea can be to use envelopes to help you save and budget. Simply figure out how many different categories of expenses you have and designate an amount and an envelope for each one. You only have the amount in the envelope to spend for that expense category (groceries, travel, etc.), so that’s going to rein you in. Dave Ramsey explains how – and why – it works.

3.   Get a side gig

If spending less is impossible or just difficult for you, there is an alternative solution you may prefer: add another source of income (or several) by getting a side gig. The benefits are obvious – you have additional income streams, which means that more money is coming in and you are saving more than you would have normally been able to.

Moreover, it’s now easier than ever to get some extra work on the side, because the gig economy is flourishing. Not only do you have your pick of jobs you can do, most of them can be done from the comfort of your own home:

• Translating
• Writing
• Proofreading
• Working as a personal assistant
• Blogging
• Voiceover work
• Graphic design, etc.

4.   Improve your credit score

Why save up more money for a down payment, when you can lower the necessary amount by cleaning up your credit? That’s right – as with most finance-related matters, your credit score plays a big part. Companies like Equifax or Experian do a great job explaining the importance of good credit, as well as the difference between different categories. What you need to remember is that the higher your credit score is, the better you will look in the eyes of the lending institution.

That means that you will be able to benefit from being offered a lower down payment, based on the fact that you’ve demonstrated financially responsible behaviour. Essentially, the lender can trust that you are able to pay back the loan on time.

Here’s how you can improve your credit score:

• Pay off old debt

You’ll be surprised at what a difference it can make to just pay off old debt. It really drags your score down, especially if it’s gone to collections. Clearing that up demonstrates responsibility and ability to pay, both of which look good to lenders.

• Set up direct debits for bill payments

Annoyed when you forget to pay your bills or accidentally miss the due date? There’s an easy solution for that: setting up direct debits. That way, all your bills will be paid automatically, on time, every single month.

• Always make sure to pay off your credit card balance on time

Credit cards can be tricky, slippery little financial tools, and if you’re not careful, you can get in trouble by not paying off the balance. If you keep up with your payments, then your credit card doesn’t have to drag your score down.

5.   Sell some stuff

Perhaps it’s not the most “traditional” way to make money, but if there are things you don’t need, why not sell them, instead of hoarding them or giving them away? Whether we’re talking about that old bike you never use, the furniture you’ve since upgraded, or the clothes that don’t fit you anymore, you can make a quick buck by putting them up online.

Sites like eBay, Depop, or Shpock allow you to sell your stuff – or buy someone else’s – as a means of recouping your investment or making some extra money. Unless you’ve got some valuable heirlooms, you’re probably not going to make a massive amount of money, but every little helps. Plus, if you’ll be moving soon, you don’t want all that junk taking up space.

6.   Change your lifestyle

This one is a big change, and some may see it as extreme. But depending on when you’re planning on achieving your down payment goal, this move may be necessary. A change in lifestyle can mean something different for everyone; as long as it saves you a significant amount of money at the end of the month, you’re doing it right.

Yes, this is going to take some adjustment on your part, and it may even be uncomfortable at times. However, you are doing it for a greater, and more important goal, and in the end, that’s what matters. Here are some ideas on changes you can make that can pad your savings:

• Quit smoking
• Downsize to a smaller/cheaper rental house
• Sell your car and use your bike, instead
• Cancel your gym membership and work out at home
• Skip the holiday abroad and have a staycation
• Stop going out and organize get-togethers at home

Conclusion

As you can see, as daunting as that down payment may be, it’s entirely possible to save money for that and be able to afford your dream home. Whether it’s learning how to save and budget your money better, getting additional income in, or making some sacrifices to set more money aside, there are always things you can do to make sure your goal of becoming a homeowner is closer.