Nearly half of Brits have No Savings towards a House Deposit
Around half (51%) of Brits have said becoming financially stable is more important than travel, getting married or having children according to research found by Share to Buy.
Their research also shows although nine in ten people still aspire to step onto the property ladder in the future, 42% have saved nothing towards a deposit for a house.
One poll found that 16% of Brits start the new year in debt and fall behind with their finances in January by spending too much over the festive period.
There has been a rise in consumers putting Christmas presents on credit and in 2018, the average worker was expected to start the year with an average of £252 in post-holiday debt.
According to Share to buy’s research on average disposable income, they also saw that the average UK household spends £300 more than they bring in.
With that in mind, one Keepmoat study of renters looking to step onto the property ladder revealed that 18% have two jobs to save for a deposit, 33% have cut back on luxuries like magazines, flowers and Netflix, 30% take a packed lunch to work every day, and 18% shop in the reduced section of the supermarket.
Fortunately, the team at Share To Buy listed out the top healthy financial resolutions that could make 2020 a financially ‘savvy’ year’:
1. Tackle Debt Before you can start saving properly, it’s important to clear your debts. Prioritise short-term debts, such as credit cards and short-term loans.
2. Set a Budget Before you start looking at homes, decide how much you can comfortably afford to spend. Calculate your total home costs (i.e. mortgage, property taxes and home insurance), to figure out how much you will need for a down payment.
3. Start Small Don’t be afraid to start small, and you’ll be surprised by how fast, small daily savings can add up. • Save Up to £1,400 in a year: With the 365 Day Money Saving Challenge, you need to save £1 on a Monday, £2 on a Tuesday, £3 on a Wednesday, finally ending with £7 on a Sunday, enabling you to save £28 a week. • Save up to £671 in a year: The 1p Savings Challenge is a more bite-sized way to save each day, requiring you to put 1p away on day one, and gradually build it up across the year, saving £0.01 on day one, £0.02 on day two, and working up to £1.51 on day 151 and £1.52 on day 152.
4. Save Big with Fewer Nights Out According to Deltic Group research, the average person spends £69.64 on a night out, with Brits going out an average of 1.51 nights a week. This equates to almost 79 nights out a year and around £5,500.
5. Start “Paying” Your Mortgage In the months before you buy, start living as if you’re paying the mortgage on your new home. That means that in addition to paying your normal rent, you take the difference between your rent and calculated future mortgage payment, and deposit it into your savings account. This habit is a good way to get used to paying a mortgage – and it helps to build up savings towards your home.
6. Cut Coffee and Save Hundreds of Pounds The average Brit drinks 676 cups of coffee a year, buying three drinks from a coffee shop every week on average (plus 10 cups of instant coffee a week). This adds up to a total of £303 spent on coffee in a year! By skipping the weekly takeaway coffees, you could easily put away a couple of hundred into your savings by the end of 2020.
7. Get Serious About Saving Most people pay all their bills and then wait until the end of the month to see how much money they have left over before putting it away in savings. It can be tempting to dip into your savings account during tight months. To prevent this, try keeping your savings account at a different bank from your checking account. You can also set up an automatic transfer into your savings account on payday.
8. Bring Your Own Bags Retail outlets are charging more and more for shopping bags, to discourage waste. Paying just 15p for a shopping bag every time you pick up groceries adds up. Bring along your own reusable shopping bags instead, and that’s around £60 in unnecessary yearly expenses cut out completely.
9. Home Cooking = Big Savings The average British household is also spending a whopping £451 a year on takeaway meals – that’s roughly three meals a month. By cutting down on takeout and making it a special once-a-month treat, you can save yourself hundreds of pounds over the course of a year.
10. Commit to Cutting Costs A good rule of thumb is to start by reducing your expenses by 10% across the board. It’s a small change that will add up to significant savings once you apply it to bills like groceries, utilities and luxuries.
There are some great money-saving apps on the market today, which can help you to make better choices when it comes to saving and spending.
You May Also Enjoy
More tenants enter the rental market
7 Ways Estate Agents Can Adapt to a Changing Property Market
Spring clean drives high maintenance bill for landlord
65% of homebuyers blame slow process on conveyancers
UK Construction Activity Collapses
