This post originally appeared on LearnVest.
After months of wedding-planning stress, a relaxing honeymoon can be just what the doctor ordered for weary newlyweds. Yet 60% of couples would give it all up if it meant they could afford a house down payment, according to a March 2014 survey from ERA Real Estate. What’s more, almost 50% of women said they’d sacrifice a big engagement ring, too, if it meant they could confidently pony up the cash for a new home.
What’s behind their willingness to sacrifice? ERA suggests it’s the bonding experience. “Our findings suggest that homeownership is an increasingly important part of a relationship, especially among the first-time homebuyer generation who are investing in their future,” Charlie Young, president and CEO of ERA Real Estate, said in a press release.
And it’s not just couples willing to work for their down-payment money. In a Trulia survey, more than a third of millennials said they’d take on a second job to pad their new-home savings.
How else are first-time homebuyers swinging their down payments? Here are three ways they’re finding the money — plus pitfalls to beware — courtesy of Marketwatch.
1. Scaling back on nonessentials
Karen Carlson, director of education and creative programs for nonprofit InCharge Education Foundation, says some of the best ways to hit your down-payment savings goals are to trade in your car for cheaper payments, cut cable, and find — and sell — items you don’t use.
Easy enough, right? Just one problem: The Trulia survey found that millennials aren’t particularly interested in following that advice. 65% said they’d never give up their cars to fund their down-payment accounts, and another 13% said scaling back on dining out was a bridge too far.
2. Ask family for a gift or loan
Half of millennials would consider asking their parents or grandparents for help with a down payment, which is a great resource — if you can get it.
But don’t forget to create a paper trail, warns Phyllis Caldwell, director of the Center for Homeownership, in Winston-Salem, NC. (A cashier’s check should do the trick.) Your mortgage lender may inquire where the money came from.
3. Borrowing from a 401(k)
About 15% of buyers take loans from their retirement funds — but this really isn’t your best course of action. Not only are there limits to how much you can take out, but also if you don’t pay it back in the allotted amount of time, you’ll be subject to additional penalties and taxes. Plus, you’ll be missing out on the magic of compound interest.
Want to know more? Check out these LearnVest articles:
5 Ways to Boost Your Down-Payment Fund
