How I Saved and Purchased my First Home on a Teacher’s Salary in my 20s

Growing up, my parents always said the “American Dream” was to become a homeowner. I guess one would say for most of my life I believed the same. I always knew I wanted to become a homeowner but didn’t know when it would happen.

My first job out of college, I was making $28,000 a year as a litigation paralegal. To be honest, I wasn’t thinking about homeownership just yet, mainly because my salary was very low. A year later, I switched careers, and became a teacher at 23. This same year, I also realized how much I had been able to save regardless of my low paying job and right then, I told myself I would start saving money to one day become a homeowner.

I figured it would take some time, as my starting salary as a teacher was around $34,000. Well fast forward, and 3 months before turning 28, I purchased my first home as a single woman living in a city with a high cost of living.

This journey took strategic planning and a lot of discipline but overall was a great learning experience for me.

I’m going to share how I navigated saving up for my home-buying process making less than 6 figures and tips for future first-timers. I’ll also outline a few things that will make the process easier.

First: Goal setting.

At 22, I wasn’t in a rush to become a homeowner but decided I should start saving now. I looked at home prices and figured I would probably need to save anywhere from $60k-$100k before I started house hunting.

Tip: Having a money goal will help hold you accountable.

Second: Automatic savings transactions.

Now that I had this money goal, every time I got paid, I would send money into my savings account. I didn’t have a set monthly amount, but I always made sure some portion of my paycheck went into my savings. In hindsight, I would have set an automatic monthly savings deposit instead.

Tip: One of the best strategies to save money is to set automatic transfers into an online high-yield savings account.

Third:  Decrease spending.

I knew my salary would be in the lower range for a while, as I just started my teaching career. I decided to decrease my spending on housing, food, and transportation. For housing, I decided to move back in with my parents after college. For food, I meal- prepped often, and I also limited my dining out to 3x a month. For transportation, I carpooled or took public transportation.

Tip: Run the numbers to figure out how much you could save monthly if you were to make adjustments to these three spending categories. Then determine what’s best for you.

Fourth: Decreased Debt

I focused on decreasing my debt. I paid my monthly student loan payments and did not accrue any additional debt.

Tip: Decreasing your debt will help your income-to-debt ratio.

Fifth: Increased credit score.

I knew the higher my credit score, the better my home buying process would be. Therefore, I worked on increasing my credit score during this time by always making sure I paid off my credit card balance in full and on time.

Tip: Having a good credit score can help you lock in better interest rates.

Sixth: Increased income.

After about 4 years of saving, I decided it was time to find ways to increase my income to try to speed up the process. I started selling clothes online and tutoring on the side.

Tip: Increasing your income will allow you to save more money. Try negotiating your salary, applying for a higher-paying job, or starting a side hustle.

My Home Buying Process Begins 

Fast forward, at 26, I had about $55,000 saved and was ready to start looking at homes. I got a realtor and started looking for homes that suited my needs. Turns out, I needed to save up more money because closing costs and down payments were higher than I expected. I did not want to be “house broke” after purchasing my home so I stopped searching for about a year.

During this time, I continued saving and learned more about the home buying process. I learned you don’t have to give 20% of the down payment and discovered the First Time Homebuyer Programs. I searched for one that I would qualify for and would be best suited for me. Based on my income and situation, I was able to qualify for a SONYMA program.

When I turned 27, I started looking for homes again. I got several mortgage pre-approvals to find the best deal. This pre-approval stated how much the bank would lend me to purchase a home, which in return helped my realtor narrow down which houses on the market I should take a look at.

Tip: Run all your pre-approvals during a 3-week period, this way this credit check only counts as one hard inquiry.

My realtor would send me new listings he came across, and I would also constantly look on Zillow and Trulia for new homes on the market. Once I became interested in a home, I always made sure to run the numbers to figure out if I could afford that home. Just because a bank will lend you X amount of dollars to purchase a home doesn’t mean you can afford it.

Tip: Run a rough estimate of your monthly mortgage, utilities, additional monthly expenses, and money goals to figure out if you could afford the home. Additionally, drive around the neighborhood of the home you’re interested in during different times of the day. You want to make sure you feel comfortable at all times of the day in your future neighborhood. Fun fact, one of my offers was accepted but after I drove around the neighborhood, I ended up rescinding my offer.

Finally, after being outbid numerous times, I found my perfect starter home. The home was beautiful and I loved the neighborhood. By this time, I had been able to save $72,000 and after running the numbers, I realized I was able to afford this home. During the time, it was a buyer’s market, so my realtor was able to negotiate the home price. I had an inspection done and hired an attorney to also help and guide me during this process. Then, about 3 months before turning 28, I officially became a homeowner. I was able to use the SONYMA program to help me with my down payment costs, and after my closing costs and fees, as planned, I still had enough savings to not be house broke.

Tip: Make sure you still have at least $10,000 left in your savings after buying a home because something always comes up, especially during your first year as a homeowner. You don’t want to risk falling into debt because you aren’t financially prepared for this.

Saving up for a home and the actual home-buying process can take time. At times, it can feel discouraging, but try to not give up or rush into things. Remember to continue educating yourself in the meantime. In time, hopefully the right home will come, and who knows, maybe you’ll even have the opportunity to house hack to help bring down your mortgage costs should that be something you’re interested in doing so. And while I no longer consider owning a home as achieving the “American Dream”, if the numbers make sense, you have the money, and you want to buy a home, then why not. 


If you feel that you need 1:1 support to help you get your finances right, schedule your free 15 minute discovery call so that we can discuss your situation and financial goals to find out how I can help you can help you feel more at ease with your money.

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