The prices of property in the UK have skyrocketed over the years, and this has made it even harder for people to upgrade their houses. Buying a bigger and better house will obviously cost you a lot of money, so you should prepare to save up some money and alter your lifestyle. Here are some tips to help you realize your goal:
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1. Use the Help to Buy ISA Offer
Saving up for your deposit can be tough. You can easily get demotivated on the way, and that is why you should take all the help you can get. The government, through the Help to Buy ISA offer, will give you 25p for every £1 you save. You will have to open an ISA account in order to access this offer. There is, however, a monthly limit of £200. This means you can access an extra £50 every month from the government.
2. Consider Cheaper Living Options
Living with people may not be the most comfortable experience, but it can help you lower the cost of living. If you have an extra room in your house, you can find a friend or family member to occupy it. That way, you will be able to split bills in the house, including the cost of food.
3. Carpool to Work
If you live near one of your co-workers, you can save a good amount of money by choosing to carpool. This will help you save some money on gas and parking. You can even go a step further and sell your own vehicle. Insurance costs a lot of money, and selling your car can help get rid of this expense. It would even be better for you to use public transportation and car-sharing services such as Uber.
4. Make a Long-term Investment with a Robo Advisor
Robo advisors can help you passively invest your money while keeping your financial management costs very low. For example, the well-known Moneyfarm charges its clients about £16 per month. These services are affordable because of the low overheads. Robo advisors are particularly important to people who have busy schedules and lack sufficient knowledge in finance and investment. The robots will work with little human intervention to invest your money in a diverse portfolio.
It is important to invest your money for the long-term since it will otherwise lose value. Interest rates offered by banks are barely enough to cover for inflation. A good investment will help grow your money significantly and buy a house even faster.
Conclusion
Most people cannot directly pay the deposit on a new home. In order to upgrade to a better house, you may have to save and invest some money. To increase your savings, you can reduce your luxuries by, for example, selling your car. You can even find a friend to live with you. You should also make a long-term investment with robo-advisors as this will allow you to grow your money passively.
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