How to Save Money for a Major Purchase

A major purchase such as a house, car or household appliance can be a distressing hit to your checkbook. Budgeting and saving for the purchase can often ease the pain.

Steps:

1. Identify the purchase you want to make.
2. Estimate what it may cost by looking at similar products.
3. Determine when you want to make the purchase.
4. Determine how much money you want to pay at the time of the purchase and how much you want to finance, either on your credit card or through the seller.
5. Commit yourself to saving a set amount of money each month, either in a savings account or some other safe account, so that you will have enough money to make the purchase at the predetermined time.
6. Be diligent and patient – your savings will accumulate.

Tips:

• Enlist the support of friends and family members.
• It is safer to save more than you need rather than less.

Warnings:

• Avoid putting your savings into risky investments – you could make a lot of money, but you could lose a lot as well.
• Watch the price of the item you wish to purchase. If it changes, you’ll have to readjust your savings rate.