Best Way To Save For A House Down Payment Are you trying to save for a down payment on your dream house? A bigger down payment can make it easier to obtain a loan and reduce your monthly mortgage payments. If you’re trying to save for a down payment, consider these strategies: 1 – Set a down payment goal. It’s easier to save if you have a clear goal for your down payment. Look at houses in your price range and talk to real estate agents to get an estimate of how much money you’re looking at for a down payment. • Lenders tend to ask for 20% as a down payment. However, you may be able to obtain a house with a smaller or bigger down payment. By having a bigger down payment, your mortgage will be smaller. 2 - Use traditional savings accounts. A traditional savings account at a bank has both advantages and disadvantages. • One of the benefits is being able to withdraw and use your money quickly. Another advantage is that there aren’t any fees for withdrawing the savings. You have instant access to the account and can use it. • The downsides of traditional savings accounts are the possibility of monthly fees and low interest rates, so your money doesn’t earn much. 3 - Use insured money market accounts. These accounts give you higher interest rates on your savings, but they aren’t always insured, like your money is in a savings account. So you could end up losing money. • It’s important to pick the right kind of account for your situation. A money market mutual fund account isn’t insured and could lose value. A regular money market account from a bank or credit union has insurance. 4 - Consider certificates of deposit (CDs). CDs tend to have higher interest rates than savings accounts, so your savings will grow as you plan your down payment. • One of the disadvantages of certificates of deposit is that they have maturity dates. This means that you can’t take out the money before the maturity date. If you do withdraw it, then you’ll have to pay fees and penalties. Your money may be unavailable for six months, a year or longer. 5 - Try the $5 bill savings plan. The $5 bill savings plan is a simple process to reach your down payment savings goal more quickly. • In addition to your regular savings routine, this plan involves saving a $5 bill every time you get one from a bank, friend, or store. If you get a $5 bill or multiple $5 bills as change, then you save them. Deposit them on a timely basis to earn interest. 6 - Take advantage of automatic savings transfers. It’s easy to forget to add money to your savings accounts. If you’re worried this will happen to you, set up automatic transfers from your paycheck to your savings account. • You can choose the amount and frequency of the automatic transfers. • One of the advantages of this strategy is that you can choose an amount you wouldn’t really miss from your checking account. What you never see, you can’t spend, either. Your savings will grow automatically. 7 - Consider state home buying assistance programs. Each state has its own programs to help home buyers save for down payments. Down payment assistance varies by location. A down payment is one of the essential steps to obtaining a house. If you’re able to save more money, you’ll have a bigger down payment, lower mortgage payments, and fewer concerns. Try these tips to save the down payment you want and need.

Invest in Real Estate for Financial Independence

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Despite the strengthening economy, according to Paige Wagner, operations manager for the American Real Estate Investors Association, 63 percent of Americans are somewhat or extremely unhappy with their present employment.

“Most individuals wind up in a job without thinking about it,” Wagner adds. “Once someone gets settled into a career, they typically remain in the same industry, even if they change employment.”

Wagner, for example, estimates that just two-tenths of one percent of the population is ready to change professions in the middle to become real estate investors.

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“Most individuals are unwilling to put in the effort to learn a new profession, even if the pay is six figures,” she adds. “It seems that the very thought of doing anything new, such as investing, leads most individuals to come up with a slew of reasons why they shouldn't get started.”

According to Wagner, the following reasons are given by individuals for not investing in real estate: It's the wrong moment to enter the real estate market, they don't have enough money to invest, or they've heard too many horror tales about landlording.

However, although some individuals come up with excuses to avoid real estate investment, others learn to overcome the challenges they encounter.

“With members in all 50 states, we can see investors profiting in both ‘up' and ‘down' markets,” Wagner adds. “Some investors even utilize unconventional ways of purchase to avoid having to come up with a down payment.” Investors who despise being landlords often sell on a rent-to-own arrangement in the hopes that their tenant buyer would agree to handle all of the day-to-day upkeep for them.”

According to Bill Bronchick, president of the Colorado Association of Real Estate Investors, real estate investment techniques have evolved throughout the years.

“It's a very different game now than it was when my mother used to invest,” Bronchick adds. “Investors nowadays may get started without using cash or credit if they are prepared to put in the time to learn.”

There is at least one real estate investment organization in almost every city.

“The monthly meetings and trainings are a great opportunity to meet people who are currently investing or are interested in doing so,” adds Bronchick. “Talking with other investors may also give you a sense of whether you're in a hot or cool market.”

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