Oh, to be bestowed with that grand honorific of ‘first home buyer’. It can feel like a fantasy sometimes, especially on the day before pay day and there are moths fluttering out of your wallet.
And sure, there are some evil, terrifying “market forces” at work that are absolutely out to get you specifically, to prevent you from ever escaping the clutches of your gross suburban sharehouse that you’re renting with sixteen other young professionals. But newsflash, you don’t have to succumb to them!
There are so many ways to get to that savings goal, and as tax time rolls around, being better informed of your deduction opportunities will have you on the path to a deposit sooner than you think is possible. It’s all about patience, persistence, and arming yourself with knowledge.
Keep your receipts safe
The biggest rule for doing your taxes effectively is to document everything. Which is not easy when you’re running around twenty different stores and you forget to take the receipt from the cashier because we’re on a time limit people!
Don’t let that mindset take hold, because it’s way harder to recuperate equipment expenses without them.
Woah, I can hear all the objections now- it’s too hard to keep those scraps of paper, they get thrown out! They clutter up my wallet! The ink on them fades! These are all valid complaints, but as is always the case, technology has come to the rescue.
Whip out your iPhone, get out the camera app, snap a piccy, and you’re done. Too easy! It’s completely valid to digitise all your invoices, and most of the time even an online transaction statement from your bank will do the trick.
For maximum efficiency, the ATO has even developed an app that lets you take photos, keep records and import into your tax return directly.
Know your industry related deductions
The next step is to get into the habit of treating everything as a potential tax deductible goodie. Having a firm sense of what expenses are unique to your profession and are therefore potential deduction is super important.
Teachers, if you’re buying stationery to use in the classroom every other week, then you can deduct that! Taking students on excursions also counts if you haven’t been reimbursed by the school.
For our tradies, all the tool purchases you personally make are eligible, as is extra safety protection. Heck, even sunscreen is included.
If you’re primarily working out of a home office and you buy a cute IKEA lamp to light the space, that could be eligible, as are your phone and internet bills.
Just started commuting? If you purchase a nice suitcase to carry your work documents and laptop, you can even claim that.
This info isn’t hard to find – it’s all on the ATO website, so take the extra time to go over those fact sheets and you’ll never be burning money again.
Use a high interest account – and commit
Once you’ve scavenged back that extra cash, you need a place to put it that’ll you get some decent profit off, and the easiest way to do that is to use a high interest account, which most of the banks offer.
Admittedly, it’s getting harder to find amazing deals as the big four are trimming off more and more, but even a 2% per annum is not to be sneezed at. If you go the extra mile and switch banks, you might be able to gain an extra percent on top of that.
Beyond that, to make the investment worth your while, you need to completely commit to saving. That means depositing every week, and not succumbing to a tempting deal on a holiday – most bonus rates require you to never withdraw, and regularly deposit.
Banking apps can be a great encouragement. The NAB app, for example, lets you give your account a name (for our purposes, let’s call it ‘First Home Deposit’), set an end date, and then it calculates how much you need to save per week to get there.
And speaking of taking advantage of great opportunities, DreamStart Homes has an offer that’s almost too good to be true. For a limited time, they are giving you up to $10k to get on your way when you build with DreamStart Homes. How will you use yours? Boost your home deposit, pay off debts or cover your rent while you build.