Tips to help you save a deposit for your first home

I have vivid memories of a conversation back in around 2010, with a colleague of mine at the time, whereby he told me that his new year’s resolution every year was to ‘fill’ his cash ISA up to the annual allowance before April 4th.

I had just joined a well-known high street bank as a cashier at the time, and had only ever used my cash ISA for storing money short term for a holiday and the like. My savvy colleague’s strategy provided a clear goal to his saving and provided much more structure and discipline to putting that money aside than I had ever applied to my own; my interest was piqued. I will caveat that the annual cash ISA allowance at the time was around £3000, but to me that was one of the turning points which allowed me to go on and save my deposit for my first home.

Saving for a house deposit can be a mighty and daunting task, especially for first-time buyers in the UK, but if you can find a way to save that inspires you (like my colleague’s method) you may find you start to enjoy the process . Here are some of my top tips to help you save for a house deposit:

1.     Set a savings goal: It's important to set a realistic savings goal and work towards it. Determine how much you need to save for a deposit and divide the total amount you need by the amount you can put aside each month to see how many months it will take you to get there. Sometimes knowing when it will happen can spur you on more.

2.     Create a budget: Creating a budget can help you identify areas where you can cut back on spending and save more money. Look for ways to reduce your expenses, such as cooking at home instead of eating out, cancelling subscriptions you don't use, or shopping for deals on groceries.

3.     Save automatically: Setting up automatic savings can help you save consistently without having to think about it. Consider setting up a standing order to transfer a portion of your salary into a savings account each month as soon as you’re paid to resist the urge to spend it.

4.     Consider a Help to Buy ISA or Lifetime ISA: These government schemes can help you save for a house deposit by offering a bonus on your savings. With a Help to Buy ISA, you can save up to £200 a month and receive a 25% bonus from the government when you use the funds for a house deposit (subject to the terms and conditions of the account).

5.     Increase your income: Consider taking on a side hustle or asking for a raise at work to increase your income, many of my clients will attest to the fact that sometimes if you don’t ask, you don’t get. This can help you save more money each month.

6.     Get financial advice: Consider speaking with a financial advisor or mortgage broker to help you create a savings plan and determine the best mortgage options for your individual circumstances.

By implementing these tips, you can start saving for a house deposit and work towards your goal of owning a home in the UK.