Practical Tips and Unique Ways on How to Save for Down Payment

A house or condo can be the single most important purchase in your lifetime, and it can be the most expensive, too. Before you can even claim ownership of the house or Taguig condo, for instance, you need to pay the down payment first. A down payment simply refers to a percentage of the total purchase price given in cash during the onset of the purchase. In short, you cannot be given any access to owning the condo that you want without paying the down payment. Do you ever wonder why homeownership eludes the average Filipino families? Because they do not have savings enough to cover for the down payment.

Here are some ways to save for the down payment in case you are eyeing a condo unit that you really want to own and live in.

1) Set a SMART goal

SMART stands for specific, measurable, attainable, realistic and timely. As such, think of a realistic amount that you are financially capable of saving. Real estate experts recommend the 2.5 rule. Determine your net monthly income, multiply it by 12 months and then, multiply the by 2.5, and the result will be the amount of the condo Taguig that you can afford. For example, if your monthly take-home pay is ?60,000, you can afford a condo unit worth ?1.8 million. The down payment will be 180,000 (10%), ?360,000 (20%) and ?540,000 (30%).

2) Save a 10th of your income

Have you heard of the saying pay yourself first? It is true. Pay yourself through savings at least 10% of your net monthly income. If you must, open a separate account for your savings and have a passbook for it, not an ATM. In this way, you will be discouraged to withdraw money from the account whenever you feel the itch to do so.


3) Work part-time

Getting a part-time job is another way of boosting your income. You can do freelance works online or work on Saturdays. You’d have many choices online such as Freelancer, oDesk and Elance. You just need to psyche yourself what things interest you the most and you enjoy doing. Focus on this niche. The pay is really rewarding since the currency is in US dollars.

4) Pay off debts on time

Firstly, if you have 2 to 3 credit cards but can’t live without one, you may opt to discard the 2nd and 3rd cards. One credit card will be enough. Next, make sure that you are paying your credit card on time so that it will not incur unnecessary interest rates. You may also ask your card provider to lower your credit limit. In this way, you won’t be tempted to use it every time you need to pay something. If possible, pay your purchases in cash. Another thing, some banks are requiring a good credit history before you can obtain a housing loan.


5) Remove the luxuries

Luxuries are the things that you can live without. For example, do you really need to buy new clothes every payday? The same goes for dining out at a fine-dining restaurant every weekend with your family, buying branded watches and drinking with friends every Friday night. Imagine how much you can save if you will cut on these unnecessary things. Once in a while is okay though.

6) Choose the cheaper choices

Most probably, you are renting a room or an apartment. Rental fees depend on the location. Why don’t you rent a cheaper room instead, find a roommate who can share the expenses with you or downgrade your 2-bedroom apartment to 1-bedroom apartment? Better yet, why don’t you live with your parents for a while? If they are living in the same city with you or in a nearby place, it would be wise to move back in if the move will not jack up the commute cost. Just tell them why you need to do it and they will definitely support your goal. So, if you are renting for ?5,000 per month, you may save up to ?60,000 per year.


7) Sell your old and slightly used stuff

Look around. Are there any items in your apartment that you no longer need and just sit in the corner collecting dust? These are junks that other people may find useful. You may choose to offer it to your neighbors, workmates, friends or relatives or you may sell it online.

8) Pack your lunch

Preparing your lunch in the morning may be a bit of a hassle, but it will be worth it, in the long run, not just for your pocket, but for your health, too. You should start to learn listing the right groceries to prepare in exchange for the unhealthy food-court lunch. If you are spending a hundred for your lunch every day (Mondays to Fridays), then you may save up to ?24,000 yearly.


9) Dial down the vacations

Hey, you can always do stay-cation, right? If you are going on a trip every 3 months, why don’t you cut it to 2 trips per year? And when enjoying one, don’t stay at an expensive hotel. Choose inns or bread and breakfasts instead. Also, there will be at least 6 long weekends in the calendar. You need not go out of town on all these weekends otherwise you will need to cough up between ?3,000 to ?5,000 for each weekend, depending on where you are going. Why not spend one Saturday at the park or anywhere near where you currently live?

10) Leverage your money

While this can be very risky, it is always worth a try. Midway your savings goal, you may choose to invest in stocks, for instance. Just learn the ins and outs before you do. Another option is to put your money in a time deposit. Major banks in the country offer deposit investment products where you can earn interest rate depending on the amount you place. The best part is, you have an option for the bank to credit the interest to your account or add it back to the principal.


There are at least three things you need to have or subject yourself into: self-discipline, financial savvy and willingness to economize. In no time, you will have the money you need to pay for the down payment. Savings will start to bulk up if you know what to do exactly. Some of the suggestions above are too broad while some are very specific. Regardless though, just be serious about it. Commit!

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