How to save a deposit while still living your life

Is it possible to save for a home deposit when you live in a ‘treatonomics’ culture? 

We’ve all heard the advice to ‘stop buying coffees and avocado toast if you want to buy a home’, but it’s not exactly practical, or enjoyable. The good news is that you don’t have to put your life on hold to save a deposit. You can continue enjoying the things you love while growing your deposit fund. Here’s how.

A balancing act: How to save money without sacrificing joy

It’s not a case of choosing between a daily coffee and a deposit, but of spending mindfully and living within your means, which will allow you to do both. These money-saving tips will help you boost your deposit savings while still living your life.  

Budget for fun 

Whatever your idea of fun is, whether that’s seeing your favourite musicians live, collecting passport stamps, catching up with friends over dinner, or all of the above, building them into your budget means you can continue enjoying them. 

Try the 50-30-20 budgeting strategy, where you split your monthly income into three categories: 

• 50% for needs. 

• 30% for wants. 

• 20% for savings. 

If that feels ambitious, the 70-20-10 version might be more feasible: 

• 70% for needs. 

• 20% for wants. 

• 10% for savings. 

For example, if your take-home pay is £2,500 per month, your budget following the 70-20-10 method would be: 

• £1,750 for needs. 

• £500 for wants.  

• £250 for savings. 

Over a year, that’s £3000 towards your deposit, plus any interest earned. 

Spend your disposable income intentionally  

Life’s little luxuries, from a flat white on your commute to a summer holiday, all count as ‘wants’. The key isn’t eliminating them entirely, but deciding which ones genuinely matter to you. Budgeting may mean reducing how often you treat yourself or setting spending limits, but your savings balance will reap the rewards. 

Boost your deposit with a specified savings account 

Using a savings account designed specifically for first time buyers can speed up your progress. For example, the Lifetime ISA allows you to save up to £4,000 per year, with a 25% government bonus, up to £1,000 annually.  

Learn more about how a Lifetime ISA can help you buy your first home. 

Automate your deposit savings 

One of the easiest ways to stay consistent is by automating your savings. Set up a direct debit to automatically move money into your savings account on payday. This minimises the temptation to spend impulsively on treats, especially if you vow to keep your deposit savings ‘off-limits’. Think of it as a short-term loss for a long-term gain; you’ll be thankful as your deposit balance increases. 

Monitor expenses 

Rather than cutting out things that bring you joy, look for savings in your essential spending instead. You could: 

• Use price comparison sites to find better deals. 

• Switch internet or mobile providers for lower monthly payments. 

• Reduce energy usage to cut utility bills. 

• Review subscriptions, cancelling ones you don’t use or switching to cheaper, ad-supported options. 

How much do I need to save for a home deposit? 

Most lenders require a minimum deposit of 5% to 10% of the property value. If you choose to buy a Shared Ownership home, the deposit is based on the value of the share you’re buying, rather than the property’s full market value, which can lower the upfront amount required. 

Find out more in our guide to the costs of buying a home. 

How long does it take to save a home deposit? 

Research by Nationwide Building Society found that, on average, it takes first time buyers six years to save a 10% deposit, based on the average property price, but this rises to nine years in London.  

While this research suggests saving for your first home can take several years, your journey will depend on your income, location and strategy. Plus, there are first time buyer schemes available to help you get there faster. 

Next steps 

Saving a home deposit in a treat-focused culture isn’t about cutting out every coffee or never going on holiday. It’s about being mindful with your spending, setting a clear budget that accounts for joy, and automating savings so you can steadily build your deposit while still living your life. 

If you’re ready to take the next step, check out our specialist mortgage broker panel to find a financial expert who can give you tailored advice.