Want to buy a house but can't afford it right now? A financial expert offers advice to Gen Zers and Millennials

The low-interest-rate environment we experienced in 2020 and 2021 made it an ideal time to enter the housing market and snag a reasonable mortgage despite the concurrent increase in house prices.

While those who were lucky enough to take advantage of this rare opportunity likely had savings on the sidelines to help them buy their new homes, others, including many Gen Zers and Millennials, weren't even close to being financially ready for homeownership.

A 2022 Bankrate survey cited affordability as the main roadblock for Gen Zers and Millennials when it comes to owning a home. Whether or not you're in a good place financially to purchase a house at the moment, Select takes a look at some things you can do in the meantime to prepare.

Your credit score plays a huge role in the interest rate you'll receive when you apply for a mortgage. While some mortgage lenders such as Rocket Mortgage and Citibank Mortgage Account offer options that cater to people with lower credit scores, it's more beneficial to improve yours before submitting an application. The higher your credit score is, the lower your interest rate will be, and this can end up saving you thousands of dollars over the life of your home loan.

"Checking your credit score early on and ideally prior to getting serious about purchasing a home will provide the opportunity to improve it, should you need to do so," explains Liz Ewing, chief financial officer at Marcus by Goldman Sachs.

Continuing to pay your bills on time and not making any late payments — or missing payments altogether — can also have an impact on your credit score, or even help to raise it.

"A recent report from Apartment List, a rental platform, found that two-thirds of aspiring millennial homebuyers have not been able to save enough money for a down payment on a home," Ewing says.

A down payment is a lump sum of money that gets paid upfront when you buy a home and is usually a portion of the home's total value — the home loan you're taking out covers the remainder of the home's value.

The down payment you'll need to make varies depending on the home's price and the type of loan you're applying for. For example, if you wanted to apply for a jumbo loan, you'd need to make a down payment that's 10% to 20% of the home's value. If you wanted to take on an FHA loan, though, you'd need to make a down payment of just 3.5%.

Figuring out which kind of loan you want can help you determine how much money you'll need to save up for the down payment. You'll also want to consider your current expenses in relation to what you can afford to pay for a mortgage.

Keep in mind that the lower your down payment is, the higher your monthly mortgage payments will be. If you already have high amounts of monthly expenses — say you provide financial assistance for a family member or have a massive student loan payment to take care of — it might be worth it to put more money toward your down payment so you'll have a slightly lower mortgage payment each month.

"When taking into account the down payment, your income, expenses and current debts, you can establish a savings goal and make an actionable plan to reach that amount," Ewing says.

High-yield savings accounts provide an easy way to save money while earning higher-than-average interest rates on your balance. In other words, these accounts can help your money grow without having to invest it. And the higher your balance is, the more interest you'll earn.

"When deciding where to save money, consider banks and banking platforms that offer competitive interest rates to help your money work as hard as possible," Ewing says. "It may be worth considering opening a high-yield savings account just for your down payment and setting up automatic direct deposits into the account on a monthly basis to save the money before having the chance to spend it."

Select ranked the Marcus by Goldman Sachs High Yield Online Savings as the best account with no fees. The SoFi Checking and Savings account is another great option, as it offers an attractive welcome bonus after you set up and receive direct deposit payments, allowing you to earn up to $400*.

Another important (but less talked about) way to save money is by using a certificate of deposit, or CD. This type of savings account holds a fixed amount of money for a fixed amount of time and in exchange, you'll receive the interest paid on your balance. While CDs typically pay higher amounts of interest than a high-yield savings account, keep in mind that you'll need to abide by the holding period set by the account issuer.

Ewing recommends exploring CD accounts if you don't plan on beginning your home search for several more months or years. The Ally Bank High-Yield CD account offers timeframes that range from three months to five years, and is definitely worth considering.

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*New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Eligible Direct Deposits received within 25 calendar days of your first Eligible Direct Deposit of $1 or more) OR $400 (with at least $5,000 total Eligible Direct Deposits received within 25 calendar days of your first Eligible Direct Deposit of $1 or more). Cash bonus amount will be based on the total amount of Eligible Direct Deposit received within 25 calendar days of your first Eligible Direct Deposit of $1 or more. If you have satisfied the Eligible Direct Deposit requirements but have not received a cash bonus in your Checking account, please contact us at 855-456-7634 with the details of your Eligible Direct Deposit. Direct Deposit Promotion begins on 5/15/2026 and will be available through 12/31/2026. Full terms at sofi.com/banking. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC. SoFi members with Eligible Direct Deposit can earn 3.30% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Eligible Direct Deposit amount required to qualify for the 3.30% APY for savings (including Vaults). Members without Eligible Direct Deposit will earn 0.80% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 9/23/26. Fees may reduce earnings. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet. *SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC's regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at SoFi.com/banking/fdic/sidpterms. See list of participating banks at SoFi.com/banking/fdic/participatingbanks. *Earn up to 4.20% Annual Percentage Yield (APY) on one SoFi Savings account with a 0.90% APY Boost (added to the 3.30% APY as of 9/23/26) for up to 6 months. Open your first SoFi Checking and Savings account and receive eligible direct deposits OR qualifying deposits of $5,000 every 31 days by 12/31/26. Rates are variable, subject to change. Terms apply at sofi.com/banking#4. SoFi Bank, N.A. Member FDIC.