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How to save for a house while renting

Are you looking to get a foothold on the property ladder, but saving a deposit while renting seems to take longer than expected?

While high rental yields across the country are making homeownership as appealing as ever, putting money aside has also become a bit more complicated. But with careful planning and budgeting, it is possible: check out our tips to get your thoughts started.


A good first step you can take is to review your budget and expenses, starting with your discretionary spending.

A new pair of fancy shoes, regular dinners out, an overseas holiday… While all of us need to splurge every once in a while, are any of these ‘extras’ getting in the way of homeownership? Any dollar you save is a dollar that can go towards your deposit, and later on, your mortgage repayments or new furnishings for your very own nest.

Need to keep an eye on your spending? Consider transferring the money into your savings account as soon as all necessary costs (and a bit of entertainment, too) have been sorted out. It’s a smart way to keep temptations at bay.

Using KiwiSaver

As you’ll know, KiwiSaver has been created with retirement in mind, but its first-home features have also been helping more and more Kiwis buy property.

If you are planning to use KiwiSaver to buy a house, it’s important to review your contribution level. An extra 1% or 2% won’t probably make much difference to your pay packet, but it could make a big difference to your house deposit over time.

Plus, make sure you don’t miss out on the maximum Government contribution (also known as ‘member tax credit’). To get the maximum annual entitlement of $521, you need to be contributing at least $1.042,86 each year. It’s literally free money up for grabs.

Lastly, check out what fund you are in, and ask for help if you need it. A financial adviser can help you make sure the fund is in tune with your ‘risk profile’ as well as your first-home withdrawal needs.

Paying off debt

If you have a personal loan or two, or maybe a credit card, it’s a good idea to pay your debt off as fast as possible. Not only is it money that is not going into your savings account; it also comes with interest attached.

Remember: while the common rule is to pay off debt before saving, put as much as you can towards paying off the debt, but do save a small amount too. It will help you build a sound savings habit – already tried and tested for when you have paid off the debt.

Sharing the costs

If you live alone but need to save more, why not get in a flatmate? Not only they will help with the rent, but will also contribute to all other bills: Internet, power, water rates and so on. Even a small amount like $150 per week will give you an extra $7,800 per year to play with. And if you already have flatmates, are there any areas that you can save (for example, food bills or costs of a cleaner)?


With increasing house prices requiring a bigger deposit, it may feel like you are saving forever, but following our simple tips could see you boost your finances and get into a home faster.


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