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From Spotlight: The Savvy Homebuyer’s Guide

6 Sly and Simple Ways to Buy a Home

Rounding up on purchases, hiding accounts from yourself, and more sneaky saving ideas.

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Contributed By

This article was contributed by LaTisha Styles, a millennial finance expert and business coach, who blogs at “Young Finances.”

A big purchase like a home requires big savings. But what if you can only save small amounts? Can you still save for a home? 

You can meet any of your financial goals if you’re determined. Here are a few tips for saving in big and small ways, on a consistent basis, so you can increase your home savings account.

1. Direct Deposit Your Savings

It’s easy to spend money when you have it. And it could be challenging to transfer money to your savings account if it’s already liquid cash in your checking account. Because when you see it there, you might be tempted to spend it. So pretend like you don’t have it.

Instead of depositing an entire check into your checking account, each month, deposit a portion of your paycheck directly into your savings. You won’t even miss it. Check with your employer to see if you can split your direct deposit into more than one account.

2. Institute a Personal Pay Day

We all have expenses we have to pay by a particular day. Why not institute the same plan for saving? One day a month, institute a personal pay day where you must transfer money into your savings account for the ultimate in personal accountability. 

3. Check Your Daily Expenses

Every day, we spend small amounts here and there on countless items. Over time, those small amounts — coffee, lunch, afternoon snacks from the vending machine — all add up. Add a few happy hour drinks, and you could be spending anywhere from $20 to $50 on a daily basis.

Breaking the habit of whittling away cash can help you save in a big way. Be choosy with what you spend money on and transfer cash directly to your savings to start seeing a difference. 

Take a moment to review your prior month's checking account statement, and read through each transaction. It’s likely that you will find a pattern and immediately see items that you could cut from your daily habits.

4. Institute a No-Spend Day

If you’re already keeping your daily expenses in check, try this supercharged method to save even more. One day a week, choose a day you’re likely to overspend and avoid spending money altogether. On a day like Saturday when you might spend money on dinner, a movie, and drinks at a bar, instead spend the day having fun outdoors or doing free activities in your city. Take the money you would have spent and transfer it directly to your savings account.

5. Save the Change

In addition to saving big chunks, you could use the “snowflake method” to increase your savings with smaller dollar amounts. With this method, you simply make small transfers from your checking account into your savings account on an automatic basis.

“I use Digit to automatically save/hide small amounts of money from myself,” says real estate investor Paula Pant in her blog.  

Pant has saved about $1,700 just by making small transfers. “It pulls $5 here, $10 there, and over time this accumulates to a decent savings balance,” she says. 

Your bank may offer this service in a program that encourages savings. For example, Bank of America offers a program called Keep the Change that will round up each transaction and transfer the change into your savings account automatically.

At Wells Fargo, the program is called Way2Save, and it offers a $1 transfer from your checking account for each debit card transaction.

Chase Bank, USAA, and U.S. Bank also have programs in place for automatic savings.

If your bank doesn’t have this program, then simply set a twice-monthly, small, automatic transfer from your checking into your new home savings account.

6. Hide Your New Home Savings

As your new home savings account begins to grow, it can be tempting to see other possibilities for these funds. For example, you might find that the amount saved perfectly matches the cost of a new big-screen TV. Or you might be tempted to spend it on a summer trip with friends. While your reason for wanting to withdraw from the account may be valid, it’s important to stay on track. 

Hiding the account from yourself can help. In your online banking settings, you may be able to hide specific accounts or account balances. This is based on the notion of “out of sight, out of mind.” 

Even small amounts will add up when you follow these steps on a consistent basis. Then, before you know it, it’s time to unhide that account and make your down payment on a new home. 

Related: 5 Ways You Didn't Know You Could Save for a Down Payment

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LaTisha Styles

LaTisha Styles is a nationally recognized millennial personal finance expert. She's the founder of and president of Financial Success Media LLC. She’s been featured in "The Economist" and mentioned in "U.S. News and World Report" as a top personal finance expert to follow on Twitter.