WAYS TO SAVE MONEY FOR A MORTAGE DEPOSIT

Putting together the deposit for your first home might seem like climbing the world’s highest mountain – but rest assured, AIB can help you with some realistic tips on savings… 

The sooner you start saving, the sooner you’ll be in a position to apply for a mortgage. You might think ‘Things are a bit tight now so I’ll put it off’. But take it from us: even if only put aside a small amount every week or month, it will get you into the habit and normalise saving.  

We really want to see you turn your key to a home of your own. That’s why we’ve put together a list of  six savings tips that take the sting out of building your deposit. 

1. It all starts with a plan 

If you want to save for a mortgage, our most helpful recommendation is also our simplest: make a realistic savings plan you can stick to.

This means looking at your current finances plus your monthly spend, then figuring out how you can save as much as possible. Without sacrificing too much fun, of course…

A brutally honest personal mortgage budget will help clarify things. Whether it’s on a sheet of paper or a spreadsheet, list all your outgoings. Some will be essential, like phone bills – but maybe there’s a cheaper plan available. If you find one, switch and put what you’ve saved into a dedicated savings account. (We’ll talk a bit more about this later.) 

After listing all the expenses you can’t currently avoid, add another column beside it where you can include details of any lower cost alternatives that you find. 
 

2. Cut down and cut out

It’s decision time. Besides cheaper alternatives, are there any expenses you can cut down on or out entirely? To help your decision, add up how much you spend on, say, that daily coffee over an entire year. A couple of euro a day turns into hundreds of euros over a year. Where you cut is down to you – but if you can, you’ll reach your deposit goal all the sooner. 

3. Turn living frugally into a positive

If spending less sounds like a sacrifice, why not try to reframe your thinking?

Sometimes, it’s possible to give these changes a positive spin. For example, you could start eating more healthily as a result of taking a packed lunch to work. Similarly, meeting friends doesn’t necessarily mean an expensive meal or drinks; maybe you could simply get out and about together for a walk. And a few more nights in means more time to focus on fitness, hobbies and personal development.

4. Spend smart

Shopping around can be a real eyeopener. It doesn’t take long to discover that similar products or quality can be bought for less elsewhere. Any savings you make can then be squirreled away in your dedicated mortgage savings account. Speaking of which…

5. Set up - and use - a specific mortgage saving account

As we mentioned earlier, we want to help you save your deposit as fast as possible. Having a specific mortgage savings account can be very useful – especially if you can’t dip into it too easily.  

 AIB would be delighted to steer you towards a suitable account. For example, you’ll be far less tempted to dig into an online account that needs seven days’ notice for withdrawals. Saying that, it also makes sense to have another account that lets you access emergency funds easily.

Once your mortgage savings account is open, set up a monthly Standing Order to make a payment from your current account as close to payday as possible. Alternatively, make transfers using the AIB Mobile app. Transferring payments quickly into your out-of-reach savings account can make you believe you’ve less money to spend than is actually the case - a useful psychological trick!

Learn more about AIB’s many savings options here.

6. Treat yourself.

Saving for a deposit is great – but don’t deny yourself fun or treats. Within your monthly budget, have a little ‘well-done-me’ money reserved for guilt-free enjoyment. If you’re also saving, spending this becomes even more fun! At the same time, make sure to use online coupons, loyalty offers and money-off deals wherever you can find them.

As well as these six ways to make saving for a mortgage deposit more manageable, you’ll find other handy resources designed to help you manage your money better here.

But how much will you actually need for your deposit? AIB Mortgage Calculators will give you a better idea of what’s required and how quickly you could save it. In the meantime, make savings a positive habit – and remember, at AIB we’re with you all the way on your mortgage journey!

Allied Irish Banks, p.l.c. is an authorised agent and servicer of AIB Mortgage Bank in relation to the origination and servicing of mortgage loans and mortgages. Allied Irish Banks, p.l.c. and AIB Mortgage Bank are regulated by the Central Bank of Ireland. Copyright Allied Irish Banks, p.l.c. 1995.