What's the best way to save for a down payment on a rental?

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@Matthew DeMichele does it really matter if you earn 2.5% or 10% on $5,000? It's a difference of $125 vs. $500... Neither will help you purchase your next property. You need to focus on earning more money or reducing other expenses.

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Live like a broke college student, even when you get that first job out of college.. ie, live well below your means. Find actionable methods to monetize your current skillset. Best will always be subjetive and unfortunately you won’t find a definitive answer here. Set a $ goal and track your progress weekly. The fact you are asking this 1-2 years out however, you are on the right path!

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@Erik Estrada @Luther Wilson III @Obed Calixte @Jon Kelly Thanks for the advice! I think all of that is solid wisdom. I do agree with your points that $5000 is too small an amount to be focused on at the moment. I should mention, though, that my situation is a little different than most college students. I'm actually a returning adult student, so I'm already working a full-time job with a base pay of around 80k. The big thing for me is lack of time. With full-time work and full-time school, I'm not able to devote enough time to buying and managing a rental at the moment. I really only have 5k set aside for real estate because, up to this point, I've put everything into retirement savings. But now that my goals have shifted to real estate, I'm planning to save at a rate that will give me around 75k in the savings account in that 1-2 year timeframe. I guess I'm really wondering a bit preemptively about what to do with the savings account when it reaches 75k. At that level, I don't know if I should let the money sit in the savings account for another year until I'm ready to take a more active investment role. Maybe, at that point, should I consider more passive investments until I'm ready to take a more active role? Or, like you all mention, should I just stay the course and focus on continuing to increase the income, reduce expense, etc.?

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For more than 20 years I specialized in flipping mobile homes in parks. The low initial investment, quick cash, and eye opening profit margins allowed me to invest in, and now own, a nice portfolio of income producing real estate. The vast majority of investors don't understand and are quick to dismiss the potential. The result is very little competition and unusually good numbers experienced in this unique niche. As an example for you, I turned a profit of $16,000 on a total initial investment of $8,000 in 6 weeks on a typical mobile home flip. I believe you need to put the money you have to work. Trying to save up from a regular income source and relying on a little interest to grow that is way too slow from my experience. For more than 20 years I specialized in flipping mobile homes in parks. The low initial investment, quick cash, and eye opening profit margins allowed me to invest in, and now own, a nice portfolio of income producing real estate. The vast majority of investors don't understand and are quick to dismiss the potential. The result is very little competition and unusually good numbers experienced in this unique niche.

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There's a lot of different ways you can go with it. That $75k (if things fall into place within the next couple years) could be invested a ton of different ways. Whatever your tastes, preferences and risk tolerance all come into play. Everyone claims their way is great, the best, and gets great returns but in reality it's great for THEM. There's a multitude of reasons that it works for them... I like single family homes and creative financing because I've watched people close to me do it for the last 20-30 years and I know it very well. What's your niche gonna be? :)

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Seller finance the down payment from the seller

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@Matthew DeMichele you're lacking some direction. Start with the end goal in mind. What are you trying to accomplish? Are you trying to buy a single family rental? Multi-family rental? BRRRR? What price point? What return do you want to make? Maybe you only need $25k to put 25% down on a $100k property.

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That's a great question. Especially, right now... It's probably not going to be in crypto, BTC or the stock market ! Unless, you're really dialed in and maybe know how to trade - I wouldn't even go there.It might sound counterintuitive, but we're living in a very interesting and "unprecedented" time right now. You might be better of leaving the money where you have it and continuing to stack it there! :)

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Make sure you get a job that earns well or start a business that will produce you enough income. One of the best ways is to start by house hacking because you can put 5% down and rent out another unit to cover some of your mortgage payment. Then you can buy another primary with 5% down, rent out the other when you reach 20% equity (to drop the MI), and now you have two properties. Obviously this sounds super easy, but I am sure some investors can attest that it is not. Even finding a value add property can be tough. It will take some time though.