First, how much should you aim for? When thinking about how to save for a house, it’s not just the down payment you have to consider. Closing costs, escrow fees, and initial payments on taxes and insurance can quickly add up. Tools like Trulia’s Affordability Calculator can help you figure out your personal home buying power so that you have a clear goal in mind.
In order to sock away what you’ll need, you’ll probably want to examine every single dollar you spend—and keep up that vigilance for the entire year or longer. As an example, if you want to buy a home that costs $250,000, you’ll need about $50,000 in cash for your down payment (factoring in a 20% down payment). Building a savings fund of $50,000 in 12 months will require you to set aside $4,167 per month for the down payment.
How can saving money here and there add up? Here are 7 ideas to help you save for a house in one year.