Equity is usually the biggest obstacle on the way to a first apartment. Here is an organized way to get there.
Step 1: Set a goal
How much does the apartment you are aiming for cost? You need at least 25% of it, plus the extra costs. For a single apartment of NIS 2 million, that is around NIS 516,000 (without an agent). How much equity you need
Step 2: Calculate the pace
How much can you save a month? If NIS 6,000, after 5 years you will have about NIS 360,000, plus returns. From this you can see how long it will take and whether the goal needs adjusting.
Step 3: Where to keep the money?
It depends on the time until the purchase: - Less than two years – conservative, liquid channels. Do not take risks with money you will need soon. - 2–5 years – a mix of conservative and a little risk. - More than 5 years – more exposure is possible, according to your risk tolerance.
Additional sources
- A study fund (keren hishtalmut) – one of the best tools. The study fund as a source of equity
- A gift from parents.
- Children's savings.
Speeding it up
- Reduce fixed expenses (insurance, communications, subscriptions).
- Close expensive debts – their interest eats your savings. Getting out of overdraft
- Save bonuses and grants in full.