Are you wondering how to save money for a house while renting?

You’re not alone. With rising inflation and rising interest rates, you realize your money is not stretching as far as it used to go.

It's no secret that buying a home versus renting is typically considered the better investment. That, however, is easier said than done when you are strapped for cash. Luckily, I am here to help! Keep on reading to learn how to save money for a house while renting in order to prepare for purchasing your dream home!

Rising inflation rates has jacked the price up of just about everything these days - including rent. With the median rent in the 50 largest U.S. cities hovering around $1,879, finding ways to save money while renting may seem like a daunting task. But, experts say that renters can still amass some cash reserves without feeling much of a pinch. It all comes down to pinpointing your priorities and shedding the rest.

Try these money saving tips:

How to save money for a house gets easier when you know a few tips to adjust your behavior for faster results.

1. Pay Your Rent with a Cash-Back Credit Card. But, beware. Some rental systems will charge an additional fee for paying rent with a credit card, so be sure to read the fine print. Paying all your expenses with a cash back card can add up significantly when you factor in groceries, gas for the car, school tuition or daycare, utilities, etc. The key is to pay it all off each month so you’re making money in cash back, and not just going into debt.

2. Try Hosting or House Hacking. Got extra space in your rental like a basement or garage? That's an opportunity to earn some extra cash! House hacking is taking a part of your current property and renting it out to someone else to make extra money. Unlike a roommate situation, where the roomie shares your space, hosting keeps you and the other renter with separate spaces.

With house hacking, it doesn’t have to be a live-in situation at all. You could rent out storage space, or rent out part of your yard or garage for someone to store a boat or car.

Again, be sure you are not breaking a lease agreement when you choose to rent out part of your space for some side cash.

3. Shop Around for a More Affordable Rental. If your rent is high or your rental has amenities that you don't use, it may be time to find a cheaper option elsewhere. Saving for a down payment on a house is a big goal. If you find you cannot find rent in your area that is cheaper, consider alternate living situations besides an apartment or house.

Living with a relative for a designated period of time could be an option. They may even be willing to let you live rent-free when they know you are actively pursuing a house buying dream.

Getting very creative, some student housing complexes that are not on campus allow non-students to rent at the very reduced rate. With this arrangement, the housing is typically four separate bedrooms in a quad style apartment with a common kitchen and living room. Each bedroom door locks. You’d have 3 other roommates you may not know initially. But if you are flexible and motivated, rent is usually under a $1000 per person.

4. Find a Roommate. Living alone can really cost you. Finding a roomie to split rent and utilities with can land some extra cash in your pocket.

Put the word out among family and friends that you are seeking a roommate. You never know who knows someone else also looking. Advertise on Facebook Marketplace or other social media channels. Sometimes not knowing your roommate is easier for living together than bunking up with someone you know. No matter where you find your roommate, take Sheldon’s advice from the Big Bang Theory and forge a roommate agreement that you both to sign. That way if things don’t work out, you have it spelled out what happens, and how much notice needs to be given before moving out.

5. Keep an Eye on Utility Usage. You do not need to sweat in the summer and freeze in the winter to save money. Simply turning the temperature up or down a few degrees can actually pay off. Add a sweater during the day and a blanket at night during colder seasons. In the summer, seek a public area to cool off and work if you work from home. Go to a restaurant, coffee house, or public library which is both cool and quiet.

Turn off lights! Remembering to turn off lights when you’re not in a room or not at home can add up by the end of the month.

Unplug. Did you know that some appliances, lighting, and mobile device chargers continue to use electricity when plugged in but when not in use?

Conclusion: Knowing how to save money for a house while renting requires discipline, strategic planning, and a commitment to financial goals. By following a few key steps, you can gradually accumulate the funds necessary for your homeownership dream. Establish a budget and cut unnecessary expenses, redirecting those savings towards a dedicated housing fund. Additionally, exploring ways to increase income, such as taking on a side gig or negotiating a raise, can accelerate the saving process too.

Now that you know how to save money for a house, you should find out how much that goal really needs to be. Want to chat with me about your home buying dream? You may be closer than you think!