Tips to save for a deposit

Saving for a loan deposit requires discipline and determination, but it’s an investment in your future. With the right strategies, you can save for a deposit sooner than you think and set up good financial habits you will need when it comes time to repay your loan.

1. See if you're eligible for first home buyer schemes

First things first, check if you're eligible for any first home buyer schemes in Australia. These programs can provide financial assistance, grants, or other benefits to help you get a foot on the property ladder. They vary by state, so it's worth doing some research to see if you qualify for these valuable initiatives.

2. Work out how much deposit you need

To save effectively, you need to know your target. Calculate the deposit amount required for your dream home. In Australia, a typical deposit is around 20% of the property's purchase price. The bigger your deposit, the better your loan terms are likely to be. So, set a clear goal.

3. Set a savings schedule

Determine a realistic timeline for your savings goal. This will depend on your income, expenses, and the desired deposit amount. Setting a schedule not only helps you stay on track but also provides a sense of achievement as you reach your milestones.

4. Set a budget and stick to it

Creating a budget is a fundamental step in your savings journey. List your monthly income and expenses to understand where your money is going. Identify areas where you can cut back and allocate those savings to your deposit fund. Sticking to a budget can be challenging, but it's incredibly rewarding in the long run.

5. Set up a high-interest savings account and automate your transactions

Maximise your savings potential by opening a high-interest savings account. These accounts offer better interest rates than regular accounts, helping your money grow faster. Automate regular transactions to transfer funds from your primary account to your high-interest account. This way, you'll consistently save without the temptation to spend the money.