IF you’ve acquired some spare change rattling round in your pockets, you possibly can put it in the direction of shopping for a house like first-time purchaser Lauren Davies did.
Lauren, 29, who works at a mortgage and insurance coverage firm, saved over £1,300 doing a easy financial savings problem for 2 years to assist purchase her £270,000 flat in Essex.
She selected to observe the penny financial savings problem as a result of it meant she may tuck away inexpensive quantities on daily basis with out feeling the pinch.
The problem works by saving a penny extra every day for a 12 months – Lauren began by saving 1p on day one, and elevated this quantity till she stashed away £3.65 on day 365.
Over a 12 months that provides as much as complete financial savings of £667.95 – which over two years meant she squirrelled away £1,335.90.
It’s not the one manner she saved money although. Lauren reduce her spending on garments, holidays and meals out to assist elevate the £13,500 deposit she wanted for her two-bed dwelling.
She didn’t get any monetary assist from associates or household for her deposit – however residing together with her mother and father meant she may save extra as she didn’t must pay lease.
Establishing an Instagram account for her new flat – which has grown to 114,000 followers – additionally meant she acquired despatched a load of furnishings freebies from corporations.
As an influencer, she’s been despatched as much as £5,000 price of free tables, chairs, mattress linen and cushions.
The Solar picked her brains about how she grew to become a first-time purchaser for the My First Residence sequence.
Inform me about your own home
It’s a two mattress new construct flat in Essex – I’m on the highest ground of my block, overlooking a neighborhood golf course.
There’s one toilet, and the kitchen, lounge and eating space is all open plan.
There’s a courtyard outdoors for all of the residents to share.
I stay on my own – I’m proud of my very own house so haven’t any plans in the meanwhile to lease the second bed room out.
My mother and father carry their canine over to go to me a few instances per week – however my flat is not large enough for a pet of my very own proper now.
How did you determine on location?
It’s close to a practice station and the excessive road, so every thing I want is on my doorstep.
Work isn’t too far-off to journey to both, and I’m close to my family and friends, so it’s a really perfect location.
How a lot did you pay for it?
The property was £270,000.
I took out a £202,500 mortgage over 35 years on a two-year mounted time period rate of interest of 1.14%.
My mortgage repayments are £620 a month.
My deposit was £13,500, and I took out a £54,000 Assist to Purchase mortgage to pay for the remainder.
Beneath the Assist to Purchase scheme, the federal government will lend you as much as 20% of the worth of your property – or 40% for those who stay in London.
The mortgage is interest-free for the primary 5 years.
I might by no means have been in a position to afford the flat and not using a Assist to Purchase mortgage. Home costs have been excessive across the space the place I wished to purchase.
In contrast to Shared Possession, my house is totally in my identify – it’s not owned by anybody else.
How did you save for it?
I made a decision to do a financial savings problem to assist save up for the deposit.
For 2 years, I did the penny financial savings problem.
I picked this one as a result of it meant I didn’t discover the cash going out and into my financial savings account as you solely needed to put a small quantity apart on daily basis.
The problem works by saving a penny extra every day.
You begin by saving 1p on day one, then the following day you save 2p, then 3p, and so forth for an entire 12 months.
You’re supposed to begin the problem on New Yr’s Day (January 1) and maintain going till the tip of the 12 months – by New Yr’s Eve, you’ll want to avoid wasting £3.65 on that day.
In complete, for those who keep on with the problem, you’ll save £667.95 over the entire 12 months.
I did the problem for 2 years, which meant I saved £1,335.90 – this went straight in the direction of my deposit.
Some other ideas?
I additionally had one other rule too – I aimed to place apart £800 per thirty days into my financial savings.
It’s quite a bit to avoid wasting per thirty days – however I lived with my mother and father, which helped me out masses, as I didn’t must pay lease.
However hitting this goal meant I needed to reduce on my spending.
To economize, I reduce down on procuring. I used to spend £300 a month on garments, however reduce this all the way down to a most of £100.
I reduce on make-up too – as a substitute of going to the wonder counter at Home of Fraser and spending £50 a month, I went to Superdrug as a substitute and reduce this all the way down to £20.
For 3 months, in the direction of the tip of my financial savings journey, I massively reduce down on takeaways and meals out too.
I used to be spending as much as £200 a month, however lowered it to £20.
To economize for furnishings, I didn’t go on vacation for 2 years.
I normally go away a few times a 12 months, which prices me as much as £1,000 – so I saved round £1,500 by staying dwelling.
How did you afford to furnish it?
I’ve an Instagram account for my new dwelling – and I get loads of free homeware and furnishings despatched to me due to that.
Again in 2019, after I moved into my flat, I began up a web page for my new flat and posted frequently.
It form of blew up greater than I used to be anticipating it to and I’ve 114,000 followers now.
I get free stuff given to me by corporations – I’ve most likely acquired round £3,000 to £5,000 price of freebies.
A few of the gadgets I have been given embody a £500 TV, a £1,000 marble desk, and a mattress price £1,500.
What’s your recommendation for different first time consumers?
Don’t select the primary home that comes alongside. Take a look at totally different areas and determine what you really need.
Preserve your finish objective in thoughts – the considered having a spot of your individual will show you how to keep on observe together with your financial savings.
Check out what first-time purchaser schemes are on the market.
The Assist to Purchase scheme enabled me to get on the ladder – in any other case, I’d nonetheless be saving up.
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