Millennials, or “Echo Boomers,” are those that were born roughly between the early 1980s and the early 2000s. According to an article published in Rappler, they make up a third of the Philippine population and are among the most highly educated and tech-savvy individuals. In the real estate market, past reports have predicted how millennials will shape the real estate industry because of reasons like their increasing spending power, technological advantage, and financial capacity, among others.
Millennials are also known to be the ones who really want to have it all and their ambitions and life goals become higher as their spending power becomes higher as well. The most recent Lamudi White Paper shows the increase of Internet usage and online real estate portals wherein the most active users belong to the millennial demographics. As millennials become more career-oriented and ambitious, most are setting goals to buy their own homes.
If you’re a millennial and you are one of those who are really serious about buying your own home, here are a few ways that will give you a headstart on how you can save for your first home.
1. Cut Down on Expenses You Don’t Really Need.
Admit it, you can be tempted to buy items you really don’t need especially when they’re on sale. Branded clothes, fancy bags, and gadgets can be very tempting especially during Christmas season or inventory sale done by shopping malls. If you keep in mind that you are saving for an important future investment, then you must resist this temptation and live modestly.
If you really need some new personal stuff, you may opt for cheaper alternatives. For instance, do you really need that new iPhone or would a cheaper smartphone that runs on Android suffice?
2. Don’t Spend Using Money That You Still Don’t Have.
Nowadays, obtaining a credit card is not as difficult as it used to be. If you have one, it is best to have self-control because you have to keep in mind that when you spend using your plastic, you are practically borrowing money for an item you can’t yet afford. Likewise, avoid getting loans, especially if you’re spending it on travel or to purchase something not important.
Interest rates can really put you under an extremely large debt that will give you difficulty paying off. So if you wish to save, use cash that you already have and keep your credit card or make a loan for emergency purposes only.
3. Find Other Sources of Income.
Don’t just depend on your paycheck and your current job. What if you lose your job and you find yourself unemployed? Finding an extra source of income will definitely save you. Manage your time, because there are a lot of ways to augment your monthly paycheck.
Discover your talent and what you’re good at. If you’re good at selling, then think of what’s good to sell, look for a supplier, and then create your online store via social media and sell stuff. If you have talent in baking or arts and crafts, make use of your hobbies and sell your creations. If you’re good in other fields like web or graphics design, teaching, or writing, apply for a freelance job that will earn you extra money.
4. Do the Elimination Process and Make Sacrifices.
Elimination process can be done by creating a list of things that you can live without. You can use this process to save on food and beverage expenses, and even transportation. If you’re the type of person who loves eating and drinking in fancy restaurants or bars, you have to motivate yourself that you will be able to save money if you start preparing your own food.
You may also consider saving on your commute and choose a cheaper mode of transportation. At first, you might feel awkward living a more modest lifestyle and let’s be real, you will be less socially active because there will be limitations on things that you can do due to your new budget scheme. Just remember to set a more balance lifestyle with some enjoyment and relaxation, but do not overspend.
5. Save as Much as You Can, Do the Math, and Be Wise.
Save as much as you can in any way, make computations, and stick to your allowance. Set up a savings, time deposit, or checking account that is separate from your usual payroll account and avoid any type of withdrawal from this account. Remember, this is for your future home and you will need this. Monitor your expenses, save on utilities, and set a budget for your bills and necessities.
Likewise, instead of spending your bonuses, commissions, and other incentives that you get from work, keep them in the bank and don’t touch them. If possible, invest in a mutual fund or equity fund that will mature and can be withdrawn in a few years’ time as a lump sum. In short, manage your finances wisely.
Buying your own home is not cheap and it will take a lot of sacrifice, patience, and determination. You will achieve your dream if you keep track of your finances, focus, and make sure that you do not stray from your ultimate goal. Remember if you are persistent you will get it, and if you are consistent you will keep it.
The article was written and submitted for publication (as guest post) by Cherianne Luise Mangrobang. She is the PR & Partnership Officer of Lamudi Philippines and MyProperty.ph, two of the country’s largest real estate websites.