City Living: Budgeting Your Money Now To Save for a Home in the Future
Urban living has some incredible benefits. You have access to great amenities, activity all around you, and the chance to be a positive part of a diverse community. Nevertheless, rental prices can be eye-wateringly high, particularly in the New York area. It’s certainly not a long-term solution if you want to save a little cash.
As such, you may be considering making the jump from renting to buying. This not only gives you a space to call your own, but it can also be an incredible investment that allows you to upgrade in the near future. However, gathering a downpayment to buy your home will require some smart budgeting. There are several ways you can budget your money to put toward buying your home in the near future.
Simplify Your Living Space
With rental rates in urban areas getting higher, many potential homeowners find it challenging to gather enough of their disposable income for a downpayment. One of the first elements to tackle is to reduce how much you’re paying for rent. While it might not be your ideal solution, downsizing your rental property now can help you buy a place faster. As with any aspect of budgeting, this is a sacrifice that pays off later.
This doesn’t mean you need to live in a state of hardship. You can still have a positive experience during your time living in smaller spaces. The design challenges of living in a studio apartment can be addressed with furniture and storage solutions. Bookcases aren’t just places to keep your belongings, they also double up as room dividers to create different zones in your home. Multi-purpose furniture like ottomans that function as storage and footrests can help minimize the clutter in your smaller space, too. Remember, downsizing is not forever. It’s a means to save the capital you can put toward your own home.
Minimize Your Transportation Costs
Owning a vehicle in the U.S. is so ubiquitous that it can sometimes feel mandatory. However, it also represents a significant drain on your budget. Rising gas prices, insurance costs, repairs, and parking fees all add up. It’s worth considering giving up your vehicle for a while to invest those costs in buying a city home. One of the ways to live budget-friendly in a big city is to take advantage of the numerous modes of public transportation, bike rental services, and walkable areas.
Alongside the budgetary advantages, it’s important to understand how you can navigate this safely. If you aren’t comfortable walking or taking the subway at night, you could occasionally take a taxi or rideshare service. Nevertheless, keep in mind the safety aspects of taxis, Lyfts, or Ubers. There are ways to keep yourself safe when using rideshare services, such as phone-tracker apps. All three companies also require drivers to have background checks, but taxis generally have more monitoring technology such as cameras and two-way radios. While neither solution is perfect, it’s important to do your research to make sure you’re not sacrificing your safety in favor of your budget.
Thrift, Upcycle, and Refurbish
Budgeting to save to buy a home in the city requires some discipline. Part of this is looking at where you can reduce what you spend on items like clothing, furniture, and appliances. You shouldn’t go without nice things entirely. After all, your space impacts your mental well-being. Nevertheless, some attention to how you get these items can help you redistribute some funds toward saving for your home.
Most cities and urban environments have a large number of thrift and consignment stores. These can be great sources for clothes, books, and other household items. Rather than investing in new furniture, seek out used items that you can easily upcycle with a coat of paint, some wood stain, and simple repairs. If you have to buy a laptop, smartphone, or home appliance consider getting a lower-cost, refurbished item. The amounts you save over the course of a year can generate a good chunk of money you can put toward your home down payment.
Conclusion
Buying a home in the city certainly takes significant capital. However, with some considerate budgeting, you can save toward a down payment. This isn’t necessarily about denying yourself the things you enjoy. Despite what some people would have you think, your avocado toast is not what’s holding you back from homeownership.
However, it’s important to look at some alternative options to your larger, regular expenses. Look into downsizing your rental space for the time being and swap your car for public transportation or walking. Remember that you can find great used clothing, appliances, and furniture. These budgeting steps don’t always have to be a part of your life, but they can help you to save now so you can buy a home in the future.
