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Buying a home is a major financial undertaking, so much so that a growing number of Americans are struggling to meet that milestone. For one thing, the homeownership rate among Millennials has dropped in recent years, due in part to a limited inventory of starter homes, and also to student debt payments monopolizing so much of younger workers’ income.

Gen Xers are having a hard time buying homes as well. Between credit card debt and child care expenses, many workers in their 30s and 40s don’t have the funds on hand to take that leap.

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The problem, of course, is that those who put off homeownership lose out on key tax breaks for as long as they continue to rent.

If you’re looking to become a homeowner, but you’re finding it difficult to meet that goal, here are a few tips to make the prospect of buying more affordable.

 

1. Rework your budget

 

You might think you don’t have much leeway when it comes to saving money each month, but if you’re willing to take a long, hard look at your budget, you’ll probably come to find that there are some expenses you can manage to cut, whether it’s the cable plan you can afford to downgrade or those daily lunches you know you can prepare yourself. Reworking your budget is apt to get you closer to your goal of buying a home, so comb through your expenses line by line and figure out which are less important to you. Then, pledge to reduce or eliminate those spending categories and bank the difference.

 

2. Get a side hustle

 

Many people think of side hustles as a way to drum up a little extra spending money. But if you’re willing to put in the time, that second gig could help you save some serious cash. Among the estimated 44 million U.S. adults who currently have a side hustle, 36% earn over $500 a month from that extra work. And that could help you reach your homeownership goal way faster than by just cutting corners here and there.

 

3. Consider the suburbs

 

It’s often the case that you’ll get more for your money in the suburbs than in a city. If you’re struggling to come up with a down payment that’ll buy you more than a shoebox in your local metro area, consider expanding your search perimeter to its surrounding towns. Many suburbs offer convenient public transportation options that allow you to commute to work while enjoying the benefits of cheaper housing and bigger living spaces than what you’d find in a city.

 

4. Boost your credit score

 

Though having a strong credit score won’t help you come up with a down payment, it will help you qualify for the best possible mortgage rate available, thus making the prospect of homeownership more affordable on the whole. Therefore, if your score isn’t stellar, it pays to take steps to raise it as quickly as possible.

You can accomplish this in a number of ways. First, make a point to pay all of your bills on time. Secondly, aim to pay down a chunk of whatever outstanding balances you’re carrying. This will alter your credit utilization ratio, which is a major component of determining your score. Finally, review your credit report thoroughly for errors. One in five credit reports contains a mistake; correcting yours could send your score into more favorable territory.

 

5. Tap your IRA

 

Though this should only be used as a last resort, if you’re really having a hard time saving for a home but are tired of throwing out money on rent, you have the option to remove up to $10,000 from an existing IRA in order to purchase your first home. Normally, withdrawing funds prior to age 59 and 1/2 would subject you to a 10% penalty, but the IRS allows this exception for first-time homebuyers.

But again, this option is far from ideal, because any time you remove money from an IRA, that’s less income you’ll have available in retirement. Furthermore, it’s not just that principal amount you’re losing out on during your golden years, but the growth it could’ve achieved over time.

Still, if you’re desperate, you might choose to take an early withdrawal and make that homeownership dream come true. As a compromise, you might decide that whatever tax savings you glean from owning will go directly into your retirement plan to compensate for the sum you withdrew.

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Homeownership doesn’t tend to come easy, but it can be rewarding on many levels. Follow these tips, and with any luck, you’ll soon be on your way to having a place to call your own.

CNNMoney (New York) First published April 19, 2018: 9:43 AM ET

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