How I Afforded to Buy a Home and Travel the World in My Mid-Twenties

A few years ago, I started searching for new ways to save money so that I could accomplish my dreams of becoming a young homeowner and traveling abroad on a regular basis. I didn’t want to limit myself. Speed forward a bit and I just turned 25 years old. In the past year, I’ve visited seven countries and bought a new condo. Here’s how I have been able to do it:

Save, save, and save.

Assess your monthly expenditures, create a savings plan, and stick to it. This is the only way you can make home buying and traveling a reality. Whether it’s cutting back on buying lattes at Starbucks, giving up a few subscriptions, or eating out less regularly — there are countless ways to save more money! I began tracking all of my expenses using the app Trail Wallet and I was shocked to discover that I was spending $75 a month on Hulu, Netflix, and Amazon videos. I was also spending over $400 a month on eating out — mainly from going out to brunch with friends, ordering take-out when I was too lazy to cook, and having drinks at local bars.

I ended up deleting many of my subscriptions, started cooking my dinners and taking leftovers for lunches, and only treating myself to take-out once a week. I also started walking more frequently to keep down transportation costs and running outside to avoid a costly gym membership. These small changes quickly added up, helping me achieve my monthly savings goal of $1000 a month — or $12,000 a year. In four years, I saved $48,000!

Apply for credit cards with generous rewards.

This is one of the greatest travel hacks. Many credits cards — like Chase Sapphire Preferred or Barclaycard Arrival Plus World Elite MasterCard — let you earn several hundred dollars in airfare after you’ve spent a minimum amount and they waive the annual fee for the first year. These cards also let you rack up airline miles, typically giving you 1.5x, 2x, or even 3x miles for every dollar spent.

I make all of my regular purchases on my card each month (groceries, utility bills, etc.), spend the minimum amount necessary to receive the bonus, and then cancel the card around a year later. If you make your monthly payments on time and don’t open up too many accounts at once, this method actually improves your credit score — making it easier to get approved for a mortgage and allowing you to fly around the world for free!

Just stick to what George Clooney said in Up in the Air, “I don’t spend a nickel, if I can help it, unless it somehow profits my mileage account.”

Breathe and do your research.

Even if you’ve saved up some money, beginning the home-buying process can seem daunting for someone in their twenties. I promise it’s not that difficult. Start off by checking your credit score, setting your budget, and determining if you have enough saved up to cover a down payment and closing costs. While some lenders prefer to see a 20 percent down payment, there are plenty of great loan options that allow down payments as low as three percent.

I spent several weeks comparing home loan options before making my pick, looking at the different interest rates, loan origination fees, discount points, private mortgage insurance options, and more. Interest rates are insanely low right now, so it’s not hard to find an affordable loan! Once you’ve made your pick and been approved, it’s all about making an offer on the right home that fits your budget and then taking a leap of faith.

Sticking to my savings plan and taking advantage of credit card rewards made all of the difference. I ended up spending half of my savings on my down payment and closing costs, but my mortgage is almost exactly the same as what I was paying to my previous landlord for rent. With the money going back into my pocket, I’ve been able to claim homeowner status, while still having enough left over to travel the world. This year, I went to Iceland, Finland, Estonia, Latvia, Lithuania, Poland, and Colombia — I wonder where’s next?