Guide to Buying your First Home

12 GUIDE TO BUYING YOUR FIRST HOME of a wealth creation program and accumulating multiple properties for an investment portfolio. Once you start, you have options. Start by opening a bank account that is difficult to draw funds from, ideally some form of term deposit account which will earn better interest than your daily account. Arrange a direct debit on payday from your daily account to this term deposit account. This amount should be an amount that is feasible to continue long term. The golden rule is – Never Touch These Savings until you have enough for the deposit to make your dream a reality. Budget to save your deposit So many first home buyers have trouble saving a deposit and think it is unachievable. Let’s think about how you might get started with budgeting to succeed. Firstly, you need to understand exactly where your current wages (and your partners) are being spent. The opportunities for saving could surprise you. Start a spreadsheet and record every purchase and the amount for one month. For example, that daily coffee is probably worth $4 a day. For a year that represents $1,460, plus that of your partner, there is a potential saving of $2,920 per year. Could you make a coffee at home before you leave the house each day? How about lunches? $10 per day for a five-day working week represents $2,400, plus your partners, a further saving of $4,800. Could you make your lunches at home for a cheaper price to enable you to save more of your deposit? What other savings could there be? At the end of the month, analyse your monthly spreadsheet of expenditures and cut out the items you honestly believe you can live without for a while. If you have a plan saving becomes easy and you will be surprised how easy it can be. Deposit Required I recommend you aim to save a deposit of 5% of the total value of the home. You will find land and new home on the fringe of Metropolitan Melbourne from approximately $400,000. We will talk more about the types of homes later but for now we will focus on deposits. 5% is a comfortable amount to get you started and the banks will most