Saving for a home is a major financial goal—and one that takes more than just setting aside money for a down payment. From closing costs to moving expenses and emergency savings, there’s a lot to consider before you’re ready to take the next step.
If you're wondering how much you need to save—or how to save smarter—you’re not alone. Many first-time buyers start small, and some loan options allow for lower down payments. But regardless of your timeline or budget, building a solid savings plan now can help set you up for success when the time comes to purchase your home.
Here are six practical ways to start saving for a house—and tips for figuring out how much you'll actually need.
It’s important to keep your house fund in an account that helps your money grow while keeping it accessible. A high-yield savings account is a smart option, especially compared to traditional checking accounts or riskier investment vehicles. This type of account earns interest over time and offers peace of mind by avoiding the ups and downs of the stock market.
You’ll want to keep your savings separate from everyday spending to avoid accidental withdrawals. A dedicated savings account also makes it easier to track your progress over time.
One of the easiest ways to build your savings consistently is to “pay yourself first.” Instead of waiting until the end of the month to set money aside, set up an automatic transfer from your checking to your savings account that aligns with your pay schedule.
By treating your savings like a recurring expense—just like rent or a utility bill—you remove the temptation to spend it elsewhere. Even a small recurring transfer can add up quickly over time.
Creating more room in your budget starts with understanding where your money is currently going. Review your bank and credit card statements to spot non-essential spending that can be reduced or eliminated. This might include unused subscriptions, frequent takeout orders, or brand-name purchases that could be swapped for generic alternatives.
You can also explore ways to reduce essential expenses—such as bundling insurance policies, switching to a more affordable cell phone plan, or refinancing existing loans. If you own more than one vehicle, consider whether a temporary one-car lifestyle could boost your savings efforts.
The more money going toward interest payments each month, the less you’ll have available to save. If possible, focus on paying off high-interest debts first—especially credit cards. Every debt you eliminate reduces your monthly obligations and frees up more money to put toward your future home.
Once a debt is paid off, consider continuing to make the same payment—but send it directly to your house fund instead. This approach not only builds momentum but also helps reinforce healthy financial habits.
Lowering your overall debt may also improve your credit score and reduce your debt-to-income ratio—both of which play a role in mortgage qualification down the road.
While cutting costs is one way to save faster, increasing your income can accelerate your timeline even more. Whether it’s picking up a part-time job, asking for a raise, or monetizing a skill or hobby, every extra dollar you earn brings you closer to your goal.
Some ideas to consider:
Offer freelance or gig services in your spare time
Sell items you no longer use
Rent out a room or parking space if you have one available
Even irregular windfalls—like a tax refund or bonus—can make a meaningful dent in your savings target when applied directly to your house fund.
Tracking your savings not only helps you stay organized but also keeps you motivated. Consider using a budgeting app or a simple spreadsheet to monitor your deposits and overall progress. Some banking apps include built-in tools for savings goals, so check to see what’s already available to you.
Being able to visualize your progress makes the process feel more rewarding and provides a clear roadmap for how much further you have to go.
While the amount will vary based on your location, loan type, and home price, a general rule is to save about 25% of the total home price to cover all upfront costs. That includes:
Down payment: Typically 3% to 20% of the purchase price
Closing costs: Generally 2% to 5%
Moving expenses: Can range from a few hundred to several thousand dollars, depending on distance and services used
Example: For a $300,000 home, you might want to save:
$9,000–$60,000 for a down payment
$6,000–$15,000 for closing costs
$1,000+ for moving expenses
You can use tools like mortgage, closing cost, and down payment calculators to estimate more specific numbers based on your situation.
Your savings timeline depends on how much you’re able to set aside each month. If you’re just getting started, don’t be discouraged by the numbers—consistency matters more than speed.
Even small contributions can add up over time, especially if you increase your savings rate as your income grows or expenses decrease.
As a rough guide:
Saving 5% of a $300,000 home ($15,000) over two years requires setting aside about $625 per month
Saving 20% ($60,000) over five years requires about $1,000 per month
Setting a realistic goal that matches your income, lifestyle, and timeframe will help make the process feel more manageable.
Buying a home is a big step—but saving for it doesn’t have to feel overwhelming. Whether your goal is one year or five years away, the most important thing is to start now. With a clear plan, consistent habits, and support along the way, you can take steady steps toward the home you’ve been dreaming of.
If you’re unsure where to begin or how much you’ll need, a BankFirst lender can help you review your options and build a savings strategy that fits your life.
We've been helping customers afford the home of their dreams for many years and we love what we do.
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