Credit Score Basics > Smart Ways to Save for Your House Deposit

Smart Ways to Save for Your House Deposit

Wollit Team2 minute read · Updated 21st July 2025

Saving for a house deposit is often the biggest hurdle to homeownership. With UK house prices rising, you need smart strategies to build your deposit fund efficiently. Here are some proven ways to save for a house deposit that actually work.

Why is saving for a house deposit important?

A house deposit is essential for getting a mortgage and reducing your borrowing costs. The larger your deposit, the better mortgage rates you'll qualify for, potentially saving thousands in interest.

Most lenders require 5-10% of the property value, but 15-20% deposits unlock the best mortgage deals and lower monthly payments.

Set a Clear Savings Goal

Research average house prices in your area and multiply by your desired deposit percentage. For example, a £250,000 house with a 15% deposit means you need £37,500. Don't forget to add around 2-3% for additional costs like solicitor fees and surveys.

Use a house deposit calculator to set realistic timelines and break your goal into manageable monthly targets. This makes the process feel less overwhelming and helps you track progress effectively.

Create a Dedicated Savings Account

Open a separate account specifically for your house deposit to prevent accidental spending. This psychological barrier helps maintain focus and stops you dipping into your deposit fund for other expenses. Look for accounts with competitive interest rates for first-time buyers.

Alongside your savings efforts, use Wollit to improve your credit file. A stronger credit profile can unlock better mortgage rates, potentially saving thousands annually.

Automate Your Savings

Set up automatic transfers to your deposit account for the day after payday. Treat your deposit savings as a non-negotiable expense, starting with a comfortable amount then increasing over time.

Try apps that round up purchases and save spare change automatically. These micro-savings can add hundreds to your deposit fund annually without affecting your daily budget.

Reduce Unnecessary Expenses

Audit your monthly expenses to identify unused subscriptions, excessive dining out, or services you can live without. Create a detailed budget to spot saving opportunities and redirect these funds straight to your deposit account.

Use tools like Wollit’s Affordability Monitor to identify spending patterns that might affect your mortgage prospects. Focus on realistic lifestyle adjustments you can maintain long-term.

Explore Government Schemes and Assistance

Government schemes can help reduce your deposit requirements:

5% deposit mortgages (though these come with higher rates)
Shared ownership schemes for eligible buyers
Right to Buy discounts if you're a council tenant

Research what your local council offers, as some provide deposit loans or assistance programmes. Check if your employer offers homebuyer support schemes too.

Maximise Your Income Potential

If your circumstances allow, explore side work or freelance opportunities that fit your schedule. Even modest additional income can meaningfully accelerate your savings timeline.

Review your current employment situation for potential improvements. This could involve negotiating a pay rise, reviewing your benefits package, or checking you're claiming all eligible tax credits and allowances.

Stay Motivated and Track Progress

Use apps or spreadsheets to visualise your progress and see how close you are to your target. Seeing your deposit fund grow provides motivation during challenging periods.

Set interim targets like reaching 25%, 50%, and 75% of your goal, celebrating these milestones without derailing your progress. Consider rent reporting services to turn your rent payments into credit-building opportunities whilst you save.

Final Thoughts

Saving for a house deposit requires discipline and smart planning, but these proven ways to save for a house deposit can significantly accelerate your homeownership journey. By combining dedicated savings accounts, automated transfers, expense reduction, and credit building, you'll be in the strongest possible position when it's time to apply for your mortgage.