Top Tips to Help You Save For a House Deposit

Buying a house today is much more complex than it used to be. When you discover just how much of a deposit you need to stump up, it’s easy to see why the number of first-time buyers has significantly dropped in recent years.

The average deposit required is 20%, so you could look at a staggering £20,000 lump sum to fork out. As most first-time buyers don’t have this kind of cash lying around, the question is, how can you save such a large amount and get your foot on the property ladder?

It’s certainly not easy, but it is doable. Below, you’ll discover some tips to help you save for that all-important house deposit.

Establishing how much you need to save

Before you start saving, it will help to have a good idea of how much you need to keep. Setting up a regular monthly savings plan is the best way to achieve your goals, but you must have a goal in mind.

The easiest way to do this is to write down how much of a deposit you’ll need. Then, determine how long you’re willing to save before buying. For example, if you’re hoping to buy in five years and need a £10,000 deposit, you’d roughly have to save £150 per month.

You can use an excellent free savings calculator to determine how long it would take and how much you’d need to save each month to raise the money for your deposit. This tip alone can help you take your savings more seriously and keep you focused on your goal.

Stop renting

Let’s face it: it’s hard to save for a deposit when most of your income is taken up by rent. That’s why many people trying to save up for a deposit move back in with their parents. Not having any rent to pay, or at least a dramatically reduced amount, can help you save hundreds of pounds a month and help you get onto the property ladder quickly.

Are you moving back in with your parents? Is that not an option? If not, an alternative could be to move into a shared house or get a lodger if you have the extra space. This tip will save you the most money.

Cut your spending

This one’s a little obvious, but cutting your spending on non-essentials can help dramatically. Many don’t even realize what we are spending on little luxuries. If you switch from a private to a council-based gym and cut back on just one takeaway a week, your savings could total £900 a year!

Once you’re close to reaching your savings goal, you should seek advice. Different lenders offer additional terms, fees, and rates.

Overall, saving for a house deposit or top-up for homebuyers’ next property isn’t accessible, but you can try plenty of tips. The above are some of the best ways to cut back and become serious about your deposit savings.