Owning a home is still a big dream for many Americans. But for people in their 30s—especially Millennials—it can feel out of reach. You might be renting, raising a family, or trying to manage debt and monthly payments. And with high prices and confusing rules, it’s easy to believe that buying a home is impossible.
But much of what’s holding people back is based on myths. You may not need as much money as you think. You don’t have to be debt-free. And skipping your favorite coffee or avocado toast probably isn’t the deal-breaker.
Let’s break down the top three myths stopping people in their 30s from becoming homeowners—and how to create a family budget to finally make it happen.
You’ve probably seen shows where young couples have giant home-buying budgets. One person sells handmade candles, the other is a part-time pet sitter, and somehow their home buying budget is $1.2 million. It feels totally unrealistic.
But here’s the truth: you don’t need a huge budget or 20% down payment to buy a home. According to the National Association of Realtors, over 60% of first-time homebuyers paid 6% or less down. That’s about $18,000 on a $300,000 house. Still a big number, but a lot less than $60,000.
Homes also come in all price ranges. The median home price in the U.S. has dropped slightly in early 2025, especially in mid-sized cities. That’s good news if you’re trying to buy.
You can start by using a budget template to estimate what you can afford. Include your monthly income, current expenses, and any debts. This will give you a clear picture of how to save money, how much money you need for a down payment, and how much home you can realistically afford.
Pro Tip: Create a zero based budget so every dollar has a job—whether it’s for savings, bills, or investing in your future.
Many people believe that student loan debt means no chance at a mortgage. In fact, over 80% of Millennials with loans say it’s holding them back. But the truth is more hopeful.
Lenders look at something called your debt-to-income (DTI) ratio—this compares your monthly debt payments (like student loans, car loans, or credit cards) to your monthly income. If your payments are high compared to your income, it can hurt your chances. But there are workarounds.
If you’re on an income-based repayment plan, your lender may use your adjusted payment, not the original one. This lowers your DTI and improves your odds. You can also consider refinancing to lower your payment each month—even if it means paying longer.
Some states have help available. For example, Maryland’s SmartBuy 3.0 helps pay off student loans as part of your home loan. Other states like Ohio and Pennsylvania offer similar programs in 2025.
Pro Tip: Work with a housing advisor to review your options. They can help you with your budget, improve your credit, and even find grants for first-time buyers.
Back in 2017, millionaire Tim Gurner said Millennials could buy homes if they just stopped eating avocado toast. The internet had fun mocking him—but the idea stuck around longer than it should have.
Yes, it’s important to be smart with spending. But cutting out brunch isn’t going to magically build your emergency fund or pay your mortgage. What really matters? Tracking your fixed expenses, reducing impulse purchases, and setting real savings goals.
Banks want to see that you can handle payments over time. They check your credit score, income, and bank statements. That’s why it’s better to focus on paying down credit card debt, building an emergency fund, and avoiding new loans right before you apply for a home loan.
Pro Tip: Use a budgeting app to track your spending. Review your bank statements monthly to see where your money is going and how much money you can save by cutting certain expenses like unused subscriptions or extra entertainment costs.
Even if you’re not ready to buy tomorrow, the steps you take now can help you get closer to your goal.
This kind of budget means putting part of each paycheck straight into savings before you spend anything else.
After you've paid yourself, do some financial tracking. Start with your monthly income and list all your expenses: fixed expenses like rent, insurance premiums, and child care; and variable expenses like groceries, gas, and entertainment. Include taxes, bills, and any debt payments.
Use a budget template to make this easier. Make sure to include space for savings, investing, and both short term goals and long term goals.
Life is full of surprises, and homeownership comes with them—like leaky roofs or broken appliances. Try to save 3–6 months’ worth of your fixed and variable expenses in a separate account.
Having these funds helps you cover the unexpected without missing bill payments or going deeper into debt.
In addition to your down payment, don’t forget closing costs, moving costs, insurance, and future maintenance costs. Look at average dollar amounts in your area so your estimate is realistic.
Your family's budget should reflect these extra costs, so you’re not caught off guard when the time comes.
And don't forget other savings goals, like retirement, short term goals, family vacations, etc.
If you have kids, factor in child care costs, child support (if applicable), and future education or healthcare needs. These can have a big impact on your budget and how much house you can afford.
If you’re caring for aging parents or supporting other family members, include those expenses too.
Debt is usually consuming more of your money than you realize. All of your spending costs are affected when you pay for things with credit instead of cash. And if your payment history isn't spotless, that can have a significant effect on your credit history. (Learn more about credit scoring here.)
You don’t need a million bucks or a perfect credit score to become a homeowner. What you do need is a plan—a budget that fits your life, room to save money, and clear priorities.
Buying a home is a big step, but it’s one you can take with the right tools. Get help if you need it. Housing counselors can walk you through your options. They can even help you find programs that offer down payment help or debt reduction strategies.
Ready to get started? Use our free budget worksheets and take the first step toward your future home. Take one of our free budgeting courses to lean more about how to manage your family finances.
Want More Help?
Visit Credit.org for free tools, guides, and financial coaching. If you're ready to buy a home but concerned that saving for a down payment is holding you back, talk to a housing coach today.
