With the tough economic climate and relatively low incomes in Ghana, buying a new home can be a daunting task for many. meqasa shares some tips on the way forward.

In many circumstances, especially in Ghana, people barely have enough to spend let alone save. However, this should not stop you from achieving that life-worthy dream of buying your own home. Here are five tips to guide you in the step towards that goal.

1. Save at Least 20% of Your income

Many find it difficult knowing how much to save, let alone saving at all. A guiding principle towards this is to set aside a certain percentage of your monthly income. Generally, anything from 20% is seen as ideal, becoming a launchpad for you to store enough funds to help you buy that dream home.

Saving just GH¢20 a month would earn you GH¢240 within a year. Like the adage goes, little drops of water make a mighty ocean so never feel discouraged by the small size of your contributions. You could be owning that very mansion you dream of before you blink!

2. Minimise Your Expenditure

A very popular description of this is the water-in-the-pierced-bottle analogy. When the bottle is left uncovered, the water spews out really fast from the holes in the bottle. However, when the bottle top is screwed on tightly, the pressure of the outflow drastically reduces. This is not to say that one can live without making any expenses whatsoever. The most important thing, however, is to ensure that you have a tight grip.

3. Prioritise Expenditure

You should categorise your expenditure into two groups, compulsory (needs) and optional (wants). Compulsory will include the likes of utility bills, food, clothing and other recurring costs such as school fees. The optional group will encompass items such as recreational activities, gifts, and generally frivolous expenses you can live without. Most products have an expensive or affordable option so there is a need to identify your needs and match them with your income.

 4. Set a Budget

Imagine what your company would be without a budget? It probably would go bust before week’s end. The same goes for your personal income, failing to budget means dancing with poverty. Unless you are fortunate to receive millions of dollars without doing any work, this tip is exactly for you.

5. Invest Your Money

Saving is just one part of the journey to owning a home. A more effective tool is investing your money into financial instruments. A lot of banks in Ghana have a number of products tailored to suit the needs of individuals, be it long or short term. Some of these are treasury bills and stock trading.

Treasury bills usually assume a low-risk characteristic, thus, returns on them are typically low. Stock trading, on the other hand, is very volatile, thereby making it a higher risk venture. However, dividends can be quite high, depending on the success of the listed company.

These financial securities are better managed by financial experts and that is where mutual funds come in. It is a pool of resources managed by a financial expert who determines the type of investment to make in order to benefit investors. Some banks also offer home savings packages, so depending on your choice, you can settle on any of these financial instruments to pave the way for home ownership.

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Following the above tips may not get you ownership of your dream home very quickly (Unless you earn a considerable sum regularly), but they will set you on the right path towards acquiring one or more in the near future. All it requires is disciplined persistence!