On my way to a doctor’s appointment this week, I got a spare moment to listen to our most recent podcast. This sparked nostalgia on my early saving & investing journey.
In listening to Ashley’s story about how she purchased her first investment property at the tender age of 21, it took me back to the days when I was saving for my first property…
When I was about 18 or 19, I decided that I wanted to have my own home, something that I could call my own. I loved the glamorous “Sex and the City” concept of being an independent woman and creating my own oasis in a bustling city. Being able to decorate a place, exactly to my liking, was so exciting to me. But I also viewed this as a stepping stone in my journey to achieving financial freedom.
I think I saved for about 6 years, and I swear my tooth-fairy money was included in my deposit! For transparency, I will disclose that my parents did help with my deposit (but only after I already saved a full deposit). To achieve this goal, these are the 5 steps that I followed to keep me determined and focused throughout the 6 years that I saved for my first home. I still own the home and have since rented it out, with the income contributing to my own Mindful Money Number.
- I had a seperate dedicated online savings account – nicknamed “My Deposit”. By having an online savings account, I saved in fees, and I could quickly and seamlessly transfer money into this account, keeping it away from temptation to spend on short term gratification.
- I transferred a certain amount of money into this account, the moment I was paid. The old saying “pay yourself first” was a godsend in helping me prioritise my deposit goal – as I was able to maintain a disciplined budget and only spend the leftover amount.
- I became obsessed – every weekend I would look online at apartments, and sometimes even inspect them. I was still years away from having a big enough deposit, but this boosted my motivation, as the dream felt so close, yet so far. It was like a dress rehearsal in the lead up to eventually inspecting the apartment that I would buy.
- I hustled! When I graduated from university, I was earning $30,000 p.a. Admittedly, I was living at home, which allowed me to save as much as possible, but relying on my salary would limit my savings capacity. So I did as many cash jobs as possible. This included market research, selling my clothes (back before this was cool!), and at one stage I even delivered pamphlets! It was small amounts of money here and there, but the cumulative effects were powerful.
- I made myself accountable. I told my family and my friends about my goal. I talked about my goal, my dream and even went into detail about how much I had saved so far, how much longer I thought it would take me, what apartments and areas I liked etc. I probably drove people around me up the wall, but in sharing my dream, I felt an even stronger sense of responsibility to achieve it! While the journey was filled with both triumphs and challenges, I eventually got there…and it was all worth it.
So if you are on the deposit-saving bandwagon, make sure you listen to Ashley’s story – it will fuel you with determination, motivation and inspiration – some of the key ingredients to success.
Canna Campbell is the founder and director of SASS Financial Services, a boutique financial planning firm. She is a Channel 9 Financial Commentator, founder of financial media platform SugarMamma.TV and best selling author of The $1000 Project and Mindful Money.