Change the way you think about rent. Saving up for a long-term financial goal can be daunting. Let’s say you want to buy a house. You can get closer to that goal by acting as if you’ve already achieved it. Try treating your rent as a mortgage payment to get closer to your goal. Want more strategies to save? Learn how to navigate the home buying process and money saving tips from Misty and State Farm® Agent Lakitsia Gaines, as they walk through her “month in money.”
The smallest changes in your spending habits can add up to big savings. So big, those changes could help you reach your financial goal. Like buying a house! That was the goal for one Texas native, but when Misty reached the end of each month she didn’t quite know ways to save extra for her long-term goals. Her biggest dream of owning a house never felt like it would become a reality. To help Misty achieve her goal, we identified new areas in her spending that could be tweaked. How? By laying it all out on the table. Literally. We transformed her month in money into a physical installation that she could explore and reevaluate. Misty and State Farm Agent, Lakitsia walked through her spending and discussed new ways to save. For instance, if you Treat Rent as a Mortgage you can establish the routine of paying more each month that’ll better prepare you for an actual mortgage payment. Plus, the additional money you are pretending to pay can go straight into your savings.
If you’re like Misty and have a clear goal in mind, congrats! Now let’s make it happen. The next step to achieving your dream, is to make a clear plan, like calculating exactly how much money it will take to get there and when that reality can come true. To better establish your own financial plan, check out our Financial Goal Calculator to crunch the numbers and get a better idea when you can celebrate your saving achievements.
If you’re in a similar boat to Misty and also want to save for a home, check out our tips for First Time Home Buyers. As you’re familiarizing yourself with the home buying process, another element of your finances to consider is your credit score. Your credit score represents the risk a lender takes when you borrow money; if it’s in a good place, it can lower your monthly loan payments. There are many things that affect your score, like late credit card payments or missing payments all together. If you have a score you’d like to be higher, not to worry — your credit score can be raised. Take a look a 5 Ways to Raise your Credit Score and put your best foot forward if you decide to apply for loans. Long-term financial goals like home buying can be daunting, but again, with a clear plan and tips to save money along the way, you can make it happen.