Most Americans find that saving money on a regular basis is a real challenge. And if you have a large expense coming up - anything from a big wedding to college costs to your own retirement - that challenge becomes even more daunting. And it's more urgent.
The good news is that you can boost your own savings ability by looking no further than your housing costs. Housing is the biggest line item in most people's budgets, and the right changes in this category could allow you to build your savings at a rate you hardly dreamed of.
Not sure how to use your housing budget to boost savings instead? Here are four ways anyone can try.
When many personal finance experts talk about saving money, they often discuss smaller ways, such as skipping your morning Starbucks habit. But you will often get more mileage from downsizing one big-ticket expense than you will from eliminating ten small expenses.
Because housing costs are such a big part of people's budgets, they also have the potential to revolutionize your monthly budget. Look for ways to make individual choices that will have the biggest impact.
This big impact may not even involve downsizing. What about moving to a similar home but somewhere you can use public transportation rather than own a car, for instance? Or perhaps renting a similar home near a college in order to avoid paying four years of room and board? Look for big-ticket solutions outside the box.
If you own a home, you may be sitting on a way to solve most of your savings problems in one fell swoop. How much equity - the sale price minus your mortgage - does your home currently have? Home values have appreciated greatly for most areas since the Great Recession, and this may be the perfect time to tap into it for a savings windfall.
Ask a real estate agent to assess the potential for your home to sell easily and for a good price. While you're at it, discuss potential negative factors you have time to correct, such as landscaping, minor repairs, or replacements. You may find that the jump in savings makes selling a much more attractive option.
The American Dream might be home ownership, but that ownership can be expensive. While mortgage payments remain the same, you continue to have additional - and often rising - related costs. These housing expenses include property taxes, homeowners insurance, repairs to the property, regular maintenance costs, and utilities for a larger home.
When you rent, though, you only have a few of these costs. You write a check for rent each month and the landlord pays taxes, insurance, repairs, and upkeep. That keeps your budget simple and free of expensive surprises. Rentals also often come with some paid utilities as well as smaller square footage for the utilities you do pay.
If you plan to rent an apartment, keep an eye out for useful amenities that can reduce other (nonhousing) costs. Then, you get an added bonus for savings. If you can use an outdoor grilling space, can you enjoy time with friends while skipping expensive dinners out? If your apartment complex has a workout room, can you cancel a gym membership? If you move closer to family, can parents help babysit?
As you assess your housing options, you're sure to find valuable ways to help reach your savings goals. At
Montgomery Realtors, we offer a variety of homes and apartments fit for any budget and any lifestyle. Check out our inventory to find a beautiful home that can free up your budget to finance your future dreams and make them a reality.
