7 tips for planning a budget when buying your new home
For most people buying a property is one of the most expensive purchases of their life, so it’s essential you are as prepared as can be, that you have budgeted properly and know and understand your financial situation.
Follow these easy tips to ensure your budget stays on track:
1. Get organised
Choose an evening and sit down with your financial paperwork. You’ll need at least an hour to do this correctly, so set aside time which will allow you to concentrate and remain level-headed while working out your options. It’s also a good idea to look at things from a different perspective and if it means you have to wait a few months before putting an offer in, then so be it. The larger the deposit you have, the better position you will be in, so the further you can plan ahead it will benefit you financially.
2. Consider your credit score
One of the most overlooked things that many buyers ignore is getting and maintaining a good credit score. This is so important to help you secure a mortgage, so stay on top of your income and outgoings, pay every bill on time and make sure you are on the electoral register.
3. Look at your income
Calculate your income by adding up your monthly earnings, plus any savings you may have to gain a better understanding of your financial situation. Using a spreadsheet on your computer can make looking at things that little bit easier or use one of the many available easy-to-use online banking tools to help you; saving you both time and stress.
4. Review your outgoings
Go through all your bank statements and work out what your expenditure is. It’s essential to be completely honest with yourself and not guess amounts, as this will make budgeting harder. As well as everyday expenses, you’ll need to consider things like petrol, meals out, beauty and holidays. If you find that you are spending more than necessary, think about cutting out your daily coffee and making your own lunch and why not sell some of your old clothes on eBay?
5. Create a plan
Once you have worked out how much money is coming in and how much is going out, it’s time to work out a plan of how much you can afford and how much you can save per month. At this stage, it’s a great idea to review all of your outgoings and see if there are any changes that can be made to cut costs, such as looking at your energy providers and seeing if switching tariffs could save you money, as well as looking to change your insurance to a cheaper one.
6. Consider extra costs
As part of your budget planning don’t forget the additional costs associated with buying a house, so as well as the initial property price, you will also need to budget for stamp duty, surveys, legal fees, agent fees and removal costs.
7. Stick to your budget
While it may be difficult to say no to that night out or a brand-new outfit, think about your long-term future and if you are serious about saving don’t spend money unnecessarily. Just imagine sitting in your new home, and sticking to your budget and making those small sacrifices will seem worthwhile.
If you have any questions about budgeting or are considering buying a property, our experienced sales team would be happy to offer any advice or answer your questions. Contact your local branch today or click here to complete our form and a member of our friendly team will get in touch with you soon.
Content accurate at time of publishing.