7 creative ways to save for your down payment

If you’re ready to make the jump from renter to homeowner, you’re probably wondering how you can save up enough money for your down payment — and you’re not alone. In fact, saving up enough money for a down payment is a top challenge for home buyers across America.

At a time when rents are high, being able to set aside any amount of money as a renter is tough. Given current market dynamics and relatively low mortgage rates, a monthly mortgage payment is a more cost-effective option in some areas, which makes the idea of homeownership enticing.

Are you ready to make the leap from renter to buyer? Here are a few creative ways you can speed up the saving process to purchase your home.

1. Save up

With some planning and time, saving up can be an extremely effective way to fund your down payment. It isn’t always easy or fast, though. This is especially true in very tight housing markets, where a down payment can be a moving target as home prices soar and cause the minimum down payment requirement to rise with it.

2. Sell your clutter

No matter the season, it’s always a good time to do a little spring cleaning. Selling off old clothes, furniture, or electronics you don’t use anymore could help you bring in lump sums of cash — and declutter your space at the same time. Depending on what you’re selling, there are a number of online sites that can connect you with potential buyers. If selling online isn’t your thing, you can always throw together a garage or yard sale.

3. Cut your monthly budget

Do you really need the additional 60 channels with your cable package? Can you downgrade your internet speed? Do you have subscriptions you can live without? These might not be ideal lifestyle changes, but when you’re trying to buy a home, you may find it worthwhile to make a  few concessions that will boost the amount you can stash away each month.

4. Live small

Although it might be a tough few months or so, downgrading your space — and with it your monthly rent payments — might help you put away more money each month for your down payment. If you can swing moving from a one-bedroom to a studio or go from renting a house to renting a smaller apartment in order to save money, you might find that the money adds up quicker than you think.

5. Spend less

Grabbing a happy hour drink after work or going to the movies on the weekend is fun, but cutting back on these outings is an easy way to pocket more cash. One trick to spending less during the month is to try a spend-free weekend. For just one weekend out of the month, try to not spend a single dollar. You might be surprised how much you actually spend in a given weekend, and how quickly money can add up if you stay in instead of going out.

6. Ask for gifts

In recent years, many home buyers have found luck asking family for cash gifts toward their down payment in place of presents to commemorate weddings, birthdays, and other milestones. 

7. Get creative with earning more cash

If you’re willing to put in a little work on the weekends or even after your regular day job, having a side gig could help bring in extra cash. You could try dog walking, waiting tables, house sitting, or selling handmade crafts online or to coworkers and friends. Or you could get a little more creative and try renting out your extra room or even a couch for a night or two at a time. You could even rent out your parking spot! Depending on where you’re located, parking spots can be a hot commodity. 

Once you start looking for ways to save, you may be surprised at how easy it becomes — and how quickly your down payment grows.