Purchasing a house can be a very exciting step in a person’s life. It requires emotional and financial readiness. In addition to being committed to paying a mortgage every month with varying taxes and fees, most home buyers have to pay a down payment for a house before securing a loan. The average amount that a buyer has to put down is roughly 20% of the purchase price of the home—this depends on the loan product. Saving this much money can seem like an overwhelming feat—here are some tips for you to make this process easier:

1. Determine How Much You can Afford to Spend on a House.

Before starting the process of saving up for a home, figure out how much you are able to afford. Start by looking at your monthly income, and factor in your monthly expenses. Try using an affordable house calculator like the one on our site. Once you know how much you can spend on a house, you can determine how much you need to save for a down payment. In most cases, you will need to save between 5-20% of the sale price for the down payment, but this is based off the loan product you select. Always talk to a Loan Originator for specific down payment information.

2. Set up a Timeline

Let’s say that you have determined that you can pay $200,000 for a house and you want to save up for a 20% down payment. This means you will have to save $40,000 total. This large amount and you shouldn’t expect to save this amount in a short amount of time. You may want to give yourself at least a few years to save this amount. For instance, if you give yourself five years to save the money, you will only have to save $8,000 per year. This number is a lot easier to imagine saving as opposed to $40,000 all at once.

3. Create a Clear Budget

Decide what you can afford to put aside each month. Start by reducing luxury expenses, for example large vacations, dining out every weekend, ect. You might have a family of four and go on vacation during the summer for a week, which could cost $4,000—this could be a substantial contribution to your down payment. If you eliminate eating out one night per week, you could save around $2,600 during the year (if the meal and drinks are around $50).

Try to reduce your essential expenses. Choosing not to buy groceries isn’t a good idea—but managing how much you spend in this area will be very helpful. By reducing the amount you spend on groceries by $20 per week, you could save $1,040 in a year! If you must buy a new car, purchase a car a few thousand dollars under your original maximum price.

Come up with a number that you can comfortably save every month—if you end up with extra money to contribute to this down payment that’s even better.

4. Open up a Separate Savings Account

One of the keys to saving is separating your money from your checking account or other savings accounts. If possible, set up an automatic transfer so your money automatically goes into this account every month. Make sure it is clear to you and your partner that this money is off limits under any circumstances. If you need money for emergencies, create an emergency fund.

5. Put Tax Refunds and End of the Year Bonuses in Your Savings Account.

Whenever you get a large amount of money, try to put all of it or at least half of it into this savings account.

6. Consider Downsizing

If you are currently renting a house or apartment that is too expensive, try switching to a less pricey one when your lease is over.

Don’t be afraid to extend your timeline if necessary. If you follow these tips, you will be well on your way to saving for a down payment. Good luck!