Tips on saving for a mortgage deposit
Raising a minimum of 10% of the value of a new house (first time buyer) is now the minimum requirement for getting on the housing ladder. The key to building up that deposit is to start saving. We have lots of handy tips and tools to get you closer to achieving your savings goal.
Unfortunately, with house prices still rising many people feel that owning their own home is beyond their immediate reach. However, with adequate planning and saving, the necessary funds can be accumulated to secure that vital deposit for a mortgage deposit. We have some handy tip and tools to get you started and saving for your home mortgage deposit.
Six tips on how to save for a mortgage deposit on your house
Tip 1: Set your goal
When it comes to buying a home, the first thing to consider is the cost of the house, the deposit you will need and how much you need to borrow from a lender for the mortgage. If you have a savings goal in mind, it will motivate you to stay focused, so decide how much you need to save to buy a house in Ireland. We have lots of tips, tools and advice to help you budget and save for a house.
Tip 2: Decide your budget
Using the Zurich budget calculator will enable you to work out what your monthly income and expenses are and how much you have available to save. It will encourage you to consider areas where cost savings can be made and consequently provide funds toward building your house deposit.
Tip 3: Cut back on expenses
The key to building up that deposit (a minimum of 10% for first time buyers) is to start saving sooner, rather than later. Are there areas where you could reduce your outgoings in order to save more? Our budget spreadsheet which will help you manage your income and expenses and motivate you to save more for your house deposit.
Tip 4: Work out how much you need to save
The Zurich Savings calculator helps you work out how much you need to save each month to meet your goals. You can estimate the costs of matching an estimated future house deposit with the required cash sum.
Tip 5: Pay off your debts
If you have any outstanding bills or debts such as credit card bills or overdrafts, make a conscious decision to pay them off on time and in full. If you are going to a lender for your mortgage, they will look at your outgoings and credit rating, so it’s important to have all this in order before you apply for a mortgage from a lender.
Tip 6: Get advice
Once you have figured out what your mortgage savings goal is, get in touch with a Zurich advisor or find an advisor near your to inquire about Zurich Regular Savings. Check out our savings and long-term investment plans to find out more.
Other things you’ll need to save for as a home buyer
Buying a house in Ireland doesn’t just involve making a final offer on a house. There are additional hidden costs like solicitor and conveyancing fees and stamp duty. Read our article on some of the costs you may incur when purchasing a house and how to budget for these.
How do Zurich's investment plans compare to bank deposit accounts?
Some people put their savings into a regular savings or deposit account with their local bank or credit union. However, over the last decade we’ve seen record low interest rates, which have led to generally lower returns for money on deposit. But when you invest your money in a fund, that little extra on top can become a lot extra.
Funds are riskier investments to money on deposit in banks and so have the potential of much higher returns, but your investment could go down as well as up.
Cash is considered safe because the amount of money in your bank deposit will never fall. However, the value of your money on a bank deposit can fall. This happens when inflation is high. High inflation means the price of goods increase, for example, your weekly shop costs more due to the price of milk, bread and cereal increasing. If you have money saved in a bank and have it ear marked for a future purpose, high inflation could mean that when you go to spend the money, the item that you are purchasing may be more expensive than what you put aside for it. Therefore, investing in funds is a common strategy used to ensure your money is not eroded by inflation.
Who is Regular Savings for?
Regular Savings are for people who want to save on a regular basis, ideally for 7+ years and are suited for those saving for a significant expenditure such as a deposit for a house. At Zurich we have a range of options to suit regular savers and can create a personal savings plan to suit you. You can save from as little as €100 per month to potentially grow your investment. You can keep track of how your savings are performing at any time by logging on to Zurich’s online Client Centre and you can switch and move between a range of investment funds, subject to certain charges. You also have the option to vary the regular payments if required, and to make a once-off lump-sum injection.
How to start a mortgage savings plan with Zurich
Once you have had time to consider your saving and investing options, you should speak to a Financial Broker, or Zurich to see how we can help. You can also Apply Online for a hassle free way to get started.
Other resources on Zurich Regular Savings
We believe that the funds you are invested in should be the bedrock of your savings plan. As an active investment manager, we are conscious of the need to invest funds responsibly. Our responsible investment strategy aims to create sustainable value with the core objective of doing well and doing good. By investing in the Prisma range through a Regular Savings plan you can benefit from strong investment performance, great active management and competitive pricing, all backed by the local expertise of Zurich Investments and the global strength and security of the Zurich Insurance Group.
About: Smart Saving
When it comes to your pensions, savings, investments and protection, Zurich is committed to doing the best we can for our customers. So, if you’d like to take the next step, get in touch today. Find a financial advisor located near you in Ireland or get in touch with Zurich’s financial advisors to start your financial wellbeing journey.
Warning: If you invest in these products you may lose some or all of the money you invest.
Warning: Past performance is not a reliable guide to future performance.
Warning: The value of your investment may go down as well as up.
Warning: Benefits may be affected by changes in currency exchange rates.
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