A LITTLE-known work perk helped Alens Gindra save £7,000 towards his £150,000 first home and he said it couldn’t have been easier.
Alens, 25, and his partner, Katie, 24, bought their three-bedroom first home in Warrington in April this year.
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Alens used a Sharesave, or Save As You Earn (SAYE) scheme to save up more than £9,000 to afford a deposit and additional fees.
An SAYE scheme lets you save regularly through your employer’s payroll over a three or five-year period.
You are then given the choice of taking every penny or your savings back, plus interest, or using the cash to buy shares in your employer.
You can save up to £500 a month under the scheme, plus you get to keep any interest tax-free.
The savings are taken directly from your pay packet, which means the money never goes into your bank account.
This means that if you find it tricky to save, you won’t be tempted to spend it rather than save it.
But it’s important to note that while you do get some interest on your cash, it might not be as competitive as other savings accounts.
Research websites like MoneyFacts.co.uk and price comparison websites such as Compare the Market, Go Compare and MoneySupermarket will show you the best rates available so you can compare.
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Plus, not all companies offer these schemes. You should check with your HR department to see if your employer has one on offer.
If not then don’t worry, because there are other accounts on offer that could help you save for a deposit.
A Lifetime Isa can be opened by anyone aged 18 to 39 and the government will add 25% to your savings, up to a maximum of £1,000 a year.
That means if you put in £4,000 a year you’ll get a £1,000 free cash bonus to put towards your first home.
Alens and Katie are now settled into their new home and are getting ready to welcome their first child together in November.
We sat down with to discuss how the couple went from being savers to homeowners or The Sun’s My First Home series.
Tell me about your house
It’s a three-bedroom terraced house in Warrington.
We have an open-plan living room and dining room and a separate kitchen.
The bathroom is also downstairs and we have a good-sized back garden.
Upstairs there are three bedrooms – the master, a home office and a bedroom that will become a nursery.
Katie and I are expecting a baby in November.
How did you decide on the location?
Both my sister and Katie’s family live in Warrington so we were keen to stay in the area.
We are in an ideal spot, because it’s just seven minutes drive to both Katie’s family and my sister and nieces.
How much was it?
Our house was on the market for £150,000, but we had our offer of £140,000 accepted by the sellers.
We put down a 5% deposit of £7,000.
We were able to take advantage of the government’s mortgage guarantee scheme to get a 95% loan-to-value (LTV) mortgage.
This is one of the reasons that we decided to go with Halifax because they were still enrolled in the scheme.
I took out a mortgage of £133,000 for 30 years with a fixed rate of 5.09%.
Our repayments are £720 a month.
How did you save for your first home?
I moved to the UK from Russia six years ago. It was meant to be a temporary move, but I met Katie and decided to settle down here.
I first started saving in September 2019 when I enrolled in a Sharesave scheme at work.
It’s a scheme that lets you save regularly through the company’s payroll over a set period.
You are then given a choice of taking all your savings back, plus interest, or using it to buy shares in the company.
I saved £260 directly from my monthly salary every month for three years because I knew this would get me a decent deposit.
It was also an affordable amount for me, and I could still cover my rent and all my bills.
At the end of the three-year period, I saved £9,360, which was enough to cover my deposit and additional fees, like solicitors.
I think the Sharesave scheme was really worthwhile because it meant I was saving without having to think about it.
You just adapt to being paid a little less every month because you don’t even see the money.
When you come to the end of the three years, you cash out all your savings and then you suddenly also benefit from being paid a little more because the money you were putting away, now goes into your bank.
How did you afford to furnish your first home?
We had a lot of furniture from our old house that we brought with us from our rented house so that saved us a lot of cash.
This included all of our appliances and our bed.
We managed to get some good bargains on Facebook Marketplace, like a brand new sofa for £100.
It would have cost us around £2,000 brand new.
Do you have any advice for other first time buyers?
Make sure that you don’t overlook small things like making sure you are on the electoral roll.
This is important because it will help to boost your credit score.
You can take out a credit card too, spend small amounts and pay it off every month to show that you are a responsible borrower.
Meanwhile, we spoke to one couple who managed to bag their first home using a “lifeline” small deposit scheme.
Plus, one first-time buyer bought with his mum after an easy mistake ruined his credit score.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected].
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