I remember it like it was yesterday. I was on a first date, which I’ll admit I don’t get many of, and my new female friend and I were laughing and having a good time. Things were going well and then she asked me if I had my own place. I slowly sank in my chair and admitted that at 27 years old I still lived at home with my parents. The second I said this, her mood instantly changed and about five minutes later she excused herself and walked out on the date. It was at this moment that I realized I needed to get serious about buying a house. All I had to figure out was how I could amass enough money for a downpayment, so with that being said, let me share with you the 5 steps I took to do just that!
Step #1: Develop an income stream
Have you ever heard the saying, “don’t put the cart before the horse?”. Well, I’m no horse expert but what I can tell you is that this saying also pertains to saving up for a down payment. Before you can start to save up a down payment, the first thing you must have in place is a means of generating income. For most people, this income stream will come in the form of a job. Now, there is nothing wrong with having a job, except for basically all the limitations that come with having one. What are those limitations? Let me explain.
Saving up enough money for a down payment is no easy feat. Chances are you are going to have to amass well over $100,000 to get yourself into that home you want. Now, for some people, the prospect of saving up six-figures is an easy proposition but I would guess that for most, saving up this amount of money seems rather daunting. In fact, I know it probably seems like an impossibility for most simply based on the savings amounts the average American has. As of late 2020, the median savings of Americans was just $3,500 which is a far cry from the $100,000 or more you would need to get yourself a house.
You can blame these lack of savings on poor spending habits or the rising costs at the grocery store but the real cause of these lackluster savings figures are insufficient incomes. It’s pretty hard to save any money when you’re barely making any to begin with. Unfortunately, your job may not cut it when it comes to earning the income you need to save up your down payment which is why I always recommend you…