Are you thinking about buying your first home?
The biggest hurdle to buying is typically the down payment (the amount of the purchase price you must pay upfront when you buy a home). With the average cost of living growing faster than the average income, many people are having a hard time-saving money, which makes saving for something large, like a down payment, particularly daunting.
But today’s buyers have one resource previous buyers didn’t: the gig economy. The gig economy has helped millions of Americans establish side hustles to help cover college expenses, pay down debt, and yes, even save for a down payment.
In this post, we’re going to give you 20 side hustle ideas to help you save for your down payment in record time.
How to Save for a Down Payment With a Side Hustle
With a side hustle, you’ll have extra earnings you can set aside for a down payment. If you’re struggling to earn enough from your day job to save for your down payment, a side hustle can be the solution you’re looking for. You’ll be able to earn money in your spare time while gaining experience, building skills, and even having fun. Our list of 20 side hustle ideas ticks all those boxes!
Now, before we get to our side hustle ideas, let’s talk about how much money you’ll need to save and how to choose a side hustle suitable for a down payment.
How Much You Need to Save to Buy a Home
The traditional down payment amount is 20% of the home’s purchase price, but with today’s programs, most buyers with good credit can qualify to buy a home with as little as 3.5% down. Some buyers can even qualify for 0% down loans, depending on the property and the location. So you may not need to save as much as you originally thought.
In addition to the down payment, you’ll need to set aside funds for “closing costs.” Closing costs cover expenses like title searches, prorated taxes, and escrow fees. Depending on your area, these typically cost somewhere between 2% and 5% of the purchase price.
For most people, this is a substantial amount of money to save. But it’s easier to save for a down payment with a side hustle.
What Makes a Good Side Hustle When Saving for a Down Payment?
Your side hustle should be something:
- You’re good at doing. Because you can charge more money when you’re talented.
- You enjoy. You’ll be spending your free time on this, so make sure it’s something you actually like doing.
- That can bring income fairly quickly. This isn’t the time for side hustles like blogging and affiliate marketing, which can take months or years to start generating income.
- That pays reasonably well. Steer clear of sites like Fiverr, in which you’re competing for low-paying gigs.
With those criteria in mind, let’s look at several side hustle ideas.
20 Brilliant Side Hustle Ideas
Here are 20 brilliant side hustle ideas that cover a wide range of abilities and interests.
- Writing. Check ProBlogger.com for projects.
- Photography. Instead of selling your photos on sites like Shutterstock (which doesn’t typically pay well), provide photo sessions for engagements, pregnancies, and family holiday cards.
- Graphic design.
- Being a virtual assistant.
- Selling digital products on Etsy. You can create a template, form, or graphic design once, then sell it over and over on Etsy.
- Driving for Uber or Lyft.
- Online tutoring.
- Editing and/or proofreading. Check out Proofread Anywhere for tips on getting started.
- Transcribing. Start with Scribie or Tigerfish.
- Pet sitting or dog walking.
- Translating with Gengo.
- Delivering through providers like Postmates and Doordash.
- Producing or editing videos.
- Teaching English online.
- Being a secret shopper. Get paid to report your shopping experiences through the Independent Mystery Shoppers’ Coalition (IMSC) or the Mystery Shopping Providers Association (MSPA).
- Personal training.
- Being a social media manager for small businesses.
- Caregiving and nannying through Care.com.
- Getting ordained to officiate weddings.
- Teaching people how to use their tech. People are willing to pay for help with their tablets and smartphones!
What to Do When You Have Enough Saved
When you meet your down payment savings goal, it’s time to get pre-qualified for a home loan. Real estate professionals nationwide recommending getting pre-approved before you even start looking at homes for two key reasons:
- The pre-approval process will tell you how much money you qualify to borrow, so you’ll know what price range to look in, and
- When you find a home you love, your pre-approval letter will give credibility to your offer by assuring the sellers that you will be able to secure funding to close the deal.
We’re always here to answer any questions you have and help guide you through the mortgage loan process. Give us a call at 757-296-2148 or start your application today at ovmfinancial.com/QuickStart
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