An expert’s 3 step plan to save a down payment faster than ever

Saving up to buy a house is a big step for a lot of people. It’s exciting and it’s new…except for me it’s not. I’ve purchased 8 houses in the last few years and saving up for them is just an equation to me now.


A long time ago, my wife and I had a big dream of an early retirement and we decided the best path to that goal was through rentals. We were so excited by this idea we even bought our first rental property while we still rented our own home!

Fast forward a few years, we achieved our dreams and I want to share with you how you can also easily save up a down payment for your home. Or many homes!

Whether it is for your first home, or a whole portfolio, the same principles apply. Saving comes first and that makes it the most important.

So here is our proven 3 step process:

Step 1 – Get motivated!

This step is so obvious that most people overlook it. But when you’re saving up for something BIG, you need to make some big changes! 

It’s easy to just stick to your routine and wait for your down payment account to grow. It’s easy to never look at your expenses. I mean if it ain’t broke don’t fix it, right? Except that’s how you reach your dream at a glacial pace… if at all.

You want that house, right? You want to live that dream, right? So get motivated, because from now on every financial decision revolves around it.

This is actually very easy to do when saving for your house. Cut out a picture of your dream home and put it in your wallet. Make it your phone and laptop background and get excited to live there. Think about colour schemes, what count bedsheets you want, and what you’ll keep in your new beautiful bathroom.

If you’re saving up for an investment property, get excited for your future with this rental income. Think about what you will do with your financial freedom.

This is the fun part! Get excited! That’s all there is for step 1.

Step 2 – Open up a dream account

From now on, every financial decision revolves around this question:

“Is this purchase worth it compared to my dream home?” 

From the smallest purchase – like that morning bagel, to the largest one – like those car upgrades, ask yourself if it’s really really worth it, then tell your house about it.

Look at your phone background and say, “I’m not giving this money to you home, I’m buying ___ instead.” Having to confront the decision of who gets your hard-earned money will really make you think!

It is going to be hard to re-evaluate all the expenses you’ve never thought twice about. But treat saving like a muscle you have to develop.

And hey, I’m not here to judge. If you decide that the purchase is, indeed, worth it – then go ahead and buy it. Buy it guilt free. But if you look at that stale bagel at the coffee shop and decide that you’d rather contribute to your dream home instead, then hurray! You’re a little bit closer to reaching your dream home down payment!

Here’s what makes saving for your down payment extra effective: Open up a “Dream account” (or a down payment account if you want to be practical) and move the money you didn’t spend right then and there. Seeing that account fill up will be far more satisfying than filling up on bagels!

So what, did we just twiddle our thumbs all day, watching our money grow?

No way! (Although it was VERY exciting).

We had nights in, where we’d talk about our dream future; we still went out for things like birthdays; and we got creative on how we could keep things fun but still be frugal.

Step 3 – Become an advanced saver

Now you get it. Question everything and be excited. That’s great but step 3 is the one that really excites me.

This is the part that not just teaches you to save for this down payment, but many down payments (I really recommend everyone has at least 1 rental property).

Cut back so hard that it hurts. Just for a while.

You need to be motivated and have that dream account going to make this work but this is basically saving magic.

No one likes being a miser but being a miser temporarily is palatable. Even better, when you cut every possible expense out of your life three special things happen:

  1. You learn what you miss – Later on you can add just those things back into your life, feel great yet still have a low monthly spend
  2. Save a lot of money right now – Getting you into that house even sooner.
  3. You know just how far you can go – Next time you are presented with any savings challenge, it will be a piece of cake!

I can’t stress enough how amazing and life changing a savings year is. It’s how my wife and I started our journey towards an early retirement and now our life is amazing. For example, during it we realized we hate cleaning and cutting the grass but we don’t mind driving an old car. Now years later, we have a regular cleaner, landscaper and a very old car. We couldn’t be happier!

Back then, after aggressive saving we saved up a down payment for our first rental house in 1 year!

Some high-value targets to check on


Great, we have a process. You are motivated, questioning everything and saving a lot. Now here are a few specific parts of your life you need to question.

We all have certain habits we’re not even aware of that cost us money but some of those habits likely have a huge effect! So here are a few parts of your life to draw into question. (We’ll use a £50,000 down payment and 7% investment returns for some quick math).

Stop eating out.

Honestly. Do you have any idea how much money most people waste on pre-made food and drinks? A burrito and a coffee here and there doesn’ seem like much but it adds up. Take a look at your bank statement right now and add last month’s food up. Seriously, go look. Shocking right?

Once upon a time my wife and I spent about £200 a week on food out. It may sound excessive but work day lunches alone were £15 with a beer every day, for each of us. That’s £150 right there each week. Go out a few times and we would easily spend £200. (We actually live in Canada but I checked with a UK friend that nothing is different across the pond).

Funneling that just money into a £50,000 down payment would get us there in just over 4 years.

That money could be in your dream account! 

Now don’t get mad. Challenge yourself to not go out for food, coffee or drinks for just one month. And each time you would have ordered in, move the money to your dream account instead!

Does that seem too hard? That’s why it’s a challenge. It’s what we did, although admittedly we invite people in frequently. Look up some easy recipes, this can be fun!

Your reward will be a nice dinner in your new home!

Cancel your subscriptions

A lot of my friends have piles of streaming services, and everything else to make their life entertaining. Sure, they use it but their subscriptions create a double whammy. First, they’re mindlessly wasting their money. Second, they’re mindlessly wasting their time!

Granted, individually these don’t cost all that much. It seems like a fair price to pay. But wouldn’t you rather see that money going towards your down payment? Not towards wasting your time?

You could both be spending your time bettering yourself (maybe to even get a raise), playing with your kids and saving money. If you consider that satellite TV is £112/mo then just cutting your TV could build up £8000 in 5 years! Cut a few more cords and you can make some huge headway.

Get a side gig

And hey, with all that extra time you spend not watching TV, maybe you can make some extra cash!

There are plenty of platforms like People Per Hour, UpWork and Textbroker, where you can get paid to write. Have marketable skills like graphic design or programming? Freelance on the side!

Even if you think you don’t have time to take on side gigs, peruse what’s available. Some of the hourly rates are too tempting to turn down and you just might find something that piques your interest!

Even Better, Get a Raise

What I would recommend even more than getting a side gig is pushing for a promotion at work. You already have the job and there is likely a lot of salary headroom that you don’t know about.

I was in management and one guarantee I can make about your job is that if you haven’t asked for a raise for a while you have been left behind.

It’s easy, all you have to do is look up your typical salary on GlassDoor and if it’s higher than your current salary put the numbers in front of your boss and tell them you think you are doing a good job. It can easily net a £5000/yr raise which if you invested it alone would get you your down payment in 8 years.

Reduce your living expenses


Reducing your living expenses may seem hard but once you’ve flexed those frugal muscles enough, it’s easy to get creative. Look at all your large, fixed expenses and ask yourself if there’s one action you can take right now to reduce them for the long term.

  • Can you get a flatmate to reduce your rent? (This can be huge!)
  • Can you refinance your mortgage to reduce your monthly payments? (Assuming you’re saving up for an investment property now.)
  • Can you move somewhere where you won’t have to pay utilities?
  • Can you get rid of your car to cut that expense out altogether? (Another huge one!)

I get it, all of these are painful and annoying. But like I said before. If you’re saving up for a BIG dream, you have to make some big changes!

So what about you? Are you willing to dream big, and what are you prepared to change in order to get there?

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Leif Kristjansen
Leif Kristjansen is the co-founder of where he and his wife write about finances and early retirement for busy people. In their early 30s, they even retired from their corporate 9-5 and want to teach you how you can do the same. They have kids and a house in a high cost of living city but managed to succeed via saving skills and rental houses.