5 Tips To Realistically Save To Buy Your Dream Vacation Property
Written by
Dawn Allcot
Edited by
Gary Dudak
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If you’ve always wanted to own a vacation property, purchasing it with the intent of renting it out could be one path to make it affordable. Vrbo, one of the largest short-term rental platforms, found that 50% of Vrbo owners pay for at least 75% of their mortgage through rental income.
But you still need to be able to afford the down payment, closing costs and repairs and renovations to turn your vacation property into a home for your family and others. Fortunately, with a little effort and discipline, saving money for your dream vacation property is possible.
Use a Bill Negotiating Service To Reduce Monthly Expenses
People often overpay for services like mobile data, car insurance, utilities, home internet and more. Bill-cutting services can help you get better rates on these expenses by negotiating on your behalf. One customer at BillCutterz.com claimed to save $1,493 per year on their bills, including cable, internet, home security and satellite radio — that’s not counting streaming subscriptions or other monthly services.
If you take that $125 per month and put it in a high-yield savings account or a 12-month CD for one year, you’ll have $1,669. Keep in mind that these services often take a cut of your savings, so you can save even more by negotiating yourself.
Cancel Costly Subscriptions
According to a C&R Research study reported by GOBankingRates.com, the average person spends $219 per month just on monthly subscription services, including streaming, software and home deliveries. One savvy saver, Tim Hopfinger Lee of Tim’s Coffee, recently told GOBankingRates that he reduced his subscription costs from $105 to $50 per month, a savings of $55 per month.
At 5% interest compounded daily, you’ll be $734 closer to your vacation home goal. If you aren’t up for the task yourself, you can use a service like Rocket Money to help you find and cancel unused subscriptions, but they will take a portion of your savings.
Clear Clutter by Selling Items
Chances are, you have appliances, furniture, clothing, toys and collectibles that you don’t use taking up space in your home. Spend a weekend taking photos and listing items on Facebook Marketplace or a service like OfferUp.
To earn faster cash without the hassle of dealing with strangers on the internet, host a garage sale. The average garage sale brings in roughly $500 to $1,000, according to Pods.com.
Find a Side Gig
There are only so many ways you can cut costs and still enjoy your life as you save for your dream vacation property. A side gig offers a fast and easy way to earn extra cash that can go directly into a high-yield savings account.
According to research from Self Financial, more than one-fourth of survey respondents with a side hustle earn between $51 and $250 per month while 19% earn more than $1,000 per month. The average earnings are $688 per month with most gig workers putting in roughly five to 10 hours per week.
That money can add up fast to contribute to your vacation home fund.
‘House Hack’ Your Primary Home
Suzanne Moore, a Realtor in the Central Oregon Investor Network, rented the upstairs portion of her home to a family of six for three years to save up enough to buy their dream vacation property in Bend, Oregon. Moore and her partner lived in the 900-square-foot basement apartment with two bedrooms.
“Was it the ideal living scenario?” she pondered. “It might not suit everyone’s dreams, but it fueled our desire to save for a vacation home… It’s pretty easy to save money when someone else is paying the majority of your mortgage payment every month.”
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