Go slow and steady when saving for your down payment

July 7, 2013 | By | 1 Comment

How to save for down payment | CanadianMortgageCo.comWondering if you’ll succeed in saving for your down payment?

Buying your first home can be daunting, especially if you’re buying a home in Toronto, Mississauga, or the surrounding areas.  Bad enough that home prices are a little intimidating.  When you start thinking about saving for your down payment, if you don’t have parents with buckets of cash just waiting for a chance to gift it to you, you may be wondering if you’ll ever be able to step into home ownership.

Saving to buy a home is like training to run a big race

I was running the other day and it occurred to me that training to run a marathon is a little bit like saving for that down payment.    And before you assume that this is an opportunity for me to brag about my running exploits, let me reassure you – this is the opposite, actually. I did run my first ever half-marathon at the beginning of May, which was awesome.  Afterward though, a combination of personal factors – some sort of flu bug, finishing off a lengthy home renovation, getting super busy with work and kid activities, and just plain resting on my laurels (maybe a teensy bit of laziness too), meant that before I knew it, I’d been missing my morning runs for weeks.  Six, if you want to know the truth.

Every morning it was the same.  I’d wake up and think how much easier it would be to just sleep that little bit longer.  Or, when I did manage to get outside, I just felt exhausted and unmotivated, and I’d end up doing more walking than running.  I tend to be a “go big or go home” type of person.  So when I found that I really didn’t have the energy for a 15 or 20 km run, I found myself getting into some pretty negative thinking.   My next goal is a full marathon, darn it!  I wasn’t getting closer to that goal at all!

The key to turning it around?

Some bags of yard waste.  I’m serious.  One day I was doing the same struggling-to-run thing and no amount of pep talks was working.  But I thought, “I’ll just run to those bags of yard waste that I see a few driveways ahead of me.”  And I did that.   Then, I saw some more, just a few driveways away.  So I figured I’d run to those.  By linking these together, I ended up running a pretty decent (in the context of my non-running month and a half) 3 kilometres.   The next day, I had to do it again.  What an annoyance!  Me, the almost-marathoner, struggling from landmark to nearby landmark!  But I kept at it, basically going on blind faith that this would eventually pay off.  A few weeks of this, and I got up to 5 km, then 8, then finally 10.  Finally getting somewhere!

My point, and I do have one:

As I was trying not to think too much about how grumpy I was that I had to essentially start from scratch, AGAIN, my mind would drift to my first-time homebuyer clients.   And I would think how similar what I’ve been going through is to someone trying to save up $20,000 or more for a down payment.  I’ve talked to people who said it was just so hard to save such a large amount of money.   No question, it is.  But, perhaps you could try my yard waste method.  A small amount of money, deposited on a steady basis, can accumulate, over time, into a large amount of money.  For example, if you could set aside $250 per paycheck, for 26 paychecks a year, in three years you have $19,500.  Top it up to $20,000, and you have enough to put a 5% down payment on a nice $400,000 townhouse in Mississauga.   Add in a few years’ worth of income tax refunds and the odd bonus, and you’ve got even more.

Yes, three years is a long time.  But you can either give up, or you can decide to go on faith.

Trust me.  That first 5 k(ms) is always the hardest.  🙂


If you want to read more, check out some of my other posts…

Using your RRSP for a down payment

Keeping your credit sparkly and clean

Homebuying tools available to you for free

I love hearing your feedback.  Let me know what you think!


Photo credit: [c] Lysanne Ooteman for stock.xchng







Filed in: First Time Homebuyer, Purchase | Tags: , ,

About the Author (Author Profile)

I'm a Toronto Mortgage Broker. My focus is on saving people time and money in financing and re-financing their homes. Am passionate about helping people make informed choices, giving back, and helping to improve financial literacy in Canada.

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