House Deposit Savings UK: Cash or Invest?
Saving for a house but unsure when you'll buy? Cash hurts in slow motion. Stocks hurt fast. Most advice picks a side. There's a hedge for the maybe-buyer nobody mentions.
£100k house deposit glide path - scenario outcomes at month 18
| Scenario | Cash | Equities slice | Total |
|---|---|---|---|
| Markets up 15% | £93,500 | £10,350 | £103,850 |
| Markets flat | £93,500 | £9,000 | £102,500 |
| Markets down 25% | £93,500 | £6,750 | £100,250 |
£500/month drip into a global tracker. Deposit intact in every scenario.
Key takeaways
If you might need the money in under two years, conventional wisdom is right: keep it in cash. Equity drawdowns over short horizons are too steep to risk a deposit.
The cost of pure cash is real. Years of "maybe next year" can quietly compound away into six figures of foregone gains, and most people end up renting longer than they planned.
A glide path hedges both regrets. Keep the bulk in a high-yield savings account, and drip a small fixed amount each month into a global index fund so your equity weight ratchets up the longer the buy decision drifts.
If the house plan dies, accelerate the drip. If it lives, the cash is intact and the modest equity exposure can either stay invested or sell down to top up the deposit.