Few of us are so rich that we can afford houses or cars with one off payments. Sure, some of us can save over a long time but more often than not we’ll need to focus on savings and loans to help acquire necessary items, appliances and so on.
Yet, there are ways to save on these without it becoming too much of a hassle, that are often merely lifestyle decisions.
The most obvious response is to shop around. Whether you’re looking for the right car, home loan, gym membership and soon, exploring your options is the obvious smart and easy way to try find the best result.
But just because you’re looking doesn’t mean you’ll find it. Speak to representatives from the relevant institutions; do extensive Google searches; sign up for news alerts regarding specials.
What is essential
A lifestyle change can have an incredible ripple effect. Cut out non-essential activities and behaviours: reconsider whether you need to go to an expensive restaurant; learnt to turn off your geyser when you’re not using it; consider what leisure activities that aren’t essential you’re paying for that can easily be avoided.
The point isn’t that you’re saving toward a large amount but that you have enough to live comfortably while paying off a loan of some kind.
Target the loan itself
Lots of organisations also suggest you focus on shrinking your loan as much as possible. As we noted, you can first try this by finding out the best deal on offer.
But from there you can also, according to MAS: “Make the payments as big as you can afford… Put any extra money towards your home loan… Negotiate your interest rate… Split your loan… Be aware of fees.”
Making large payments is one of the best ways to reduce it, since it means your total comes down faster. Naturally negotiating your interest rate is also key, since you are, in the end, paying more if you’re paying back a loan – than you would if you bought a home or car once-off.
Of course, even people who have the money at the time, might prefer to choose a car or home loan because it makes sense for managing finances. With a large lump some given away, you can’t prepare for the rest of the days absent that amount – whereas managing a smaller amount over a greater time gives you more control.