Saving for a Down Payment: Turning the Dream of Homeownership into a Reality

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Saving for a Down Payment: Turning the Dream of Homeownership into a Reality 





































For many individuals and families in Maine, the dream of homeownership represents more than just a roof over their heads. It’s about establishing roots, building equity, and creating a space that truly feels like home. But before the keys are handed over, there's a vital first step every aspiring homeowner must take: saving for the down payment.

At Kennebec Savings Bank, we’ve walked alongside generations of Mainers on their homebuying journeys. And whether you’re purchasing your first home or reentering the market, understanding how to prepare financially—especially for the down payment—can make all the difference. Let’s explore how you can turn your dream into a concrete plan.

Why a Down Payment Matters

Your down payment is the initial lump sum you contribute toward the purchase of your home. In many cases, it represents 5–20% of the home’s total cost. The amount you put down directly impacts the size of your mortgage and your monthly payments.

A larger down payment can reduce your overall loan cost and may allow you to avoid paying private mortgage insurance (PMI). But no matter the percentage, saving for a down payment requires planning, discipline, and time.

Step One: Set a Clear Goal

Before you start setting aside money, it helps to have a number in mind. If you’re aiming to buy a $300,000 home, a 10% down payment would require $30,000; a 20% down payment would be $60,000. Even a 5% down payment—$15,000—still requires intentional planning.

Not sure what price range is realistic for you? Our team at Kennebec Savings Bank can help you determine what’s affordable based on your income, debt, and overall financial situation. Once you have a target down payment amount, you can break that into manageable monthly savings goals.


Step Two: Open a Dedicated Savings Account

A powerful yet simple step is to open a separate account specifically for your down payment. Keeping this money separate from your everyday spending account helps reduce the temptation to dip into it for non-essential purchases.

At Kennebec Savings Bank, we offer a range of savings options—from traditional savings accounts to high yield money market accounts and certificates of deposit (CDs). All are designed to keep your money secure while helping it grow steadily.


Step Three: Automate Your Savings

Once your account is open, automate your contributions. Set up a recurring transfer each payday to your traditional savings account—whether it's $25, $100, or more, consistency is key. Treat it like a non-negotiable bill to your future self. Over time, these incremental deposits can add up significantly.

If you receive a raise, tax refund, bonus, or any other unexpected income, consider adding a portion to your down payment fund. Even small windfalls can shave months off your savings timeline.

Step Four: Reduce Unnecessary Expenses

One of the fastest ways to supercharge your savings is by evaluating your spending habits. Could you cook more meals at home? Cancel unused subscriptions? Delay large purchases that aren’t urgent?

Every dollar you divert from discretionary spending to your down payment fund brings you one step closer to homeownership. While these adjustments might seem small, over the course of a year or two, they can make a significant impact.


Step Five: Explore Safe Growth Options

If your timeline to purchase a home is more than a year away, you may want to consider ways to grow your savings a bit faster—while keeping your money accessible and low-risk.

Money Market Accounts typically offer higher interest rates than standard savings accounts and may allow for some check writing. They’re a great option for people who want to earn more while maintaining liquidity.

Certificates of Deposit (CDs) are another strong choice. In exchange for agreeing to leave your money in the bank for a set period—such as six months or a year—you’ll typically earn a higher rate of return. Just be sure to align the CD term with your intended purchase timeline.

Our team at Kennebec Savings Bank can help you compare these options and choose the one that best fits your goals and timeframe.


Staying Motivated Along the Way

Saving for a down payment is a marathon, not a sprint. Like any long-term goal, it can sometimes feel distant or even overwhelming. That’s why it’s important to celebrate small milestones—each time you hit a savings goal, acknowledge your progress.

Keep visual reminders of your goal—a picture of your dream home, a vision board, or a chart showing your savings growth. Regular check-ins with a financial advisor or lender can also help keep you on track and motivated.


Your Dream is Within Reach

Saving for a down payment takes discipline and patience, but it’s a challenge well worth the effort. Each dollar saved is a step closer to owning a place to call your own—a place where your future unfolds.

Whether you're early in your career, building your family, or simply ready to stop renting and start investing in your future, homeownership is a goal you can achieve. And when you're ready to make that leap, Kennebec Savings Bank will be right by your side.

Let’s start today. Open a dedicated savings account, set up your automatic transfers, and take that first step. Your future home is waiting—and we’re here to help you unlock the door.


Interested in starting your savings journey?
Visit your local Kennebec Savings Bank branch or explore our online tools at Mortgage Center – Residential Loans – Kennebec Savings Bank to learn more about current mortgage rates, meet our team, and utilize our financial calculators.



Written By: Andrew Silsby, President & CEO