To save for a home, there are many practical first steps, such as calculating how much home you can afford, determining your down-payment goal, and factoring in closing costs and moving expenses. By using targeted savings strategies—like opening a dedicated high-rate savings account, practicing "paying your mortgage," and controlling debt— you can reach your home-buying goal even faster.
Most experts recommend spending 28% or less of your gross monthly income on housing expenses, which include your mortgage, taxes, association fees, and insurance. A mortgage calculator can help you estimate this figure. You should also determine your monthly budget. If you don't have a budget, check out the 50/30/20 budget method to quickly create one, and then use a home affordability calculator to determine how much house you can afford.
No. While a 20 percent down payment was once standard, many mortgage lenders now offer options with 5 percent, 3 percent, or even zero percent down. Traditional mortgage lenders used to require buyers to put down 20 percent, but there are more mortgage options available now, largely because it can be difficult to reach that 20 percent savings goal depending on your timeline and financial situation.
Buying a home with less than 20 percent down can broaden your choices, but it's important to ask questions and compare programs and loan qualification requirements as you weigh the pros and cons to decide if it's the right decision for you. For example, if you calculated you can afford to buy a home with a purchase price of $300,000 and want to put down 20 percent, you would need to save $60,000 for the down payment.
Beyond your down payment, you will want to budget for closing costs, moving costs, appraisal and inspection fees, and possibly private mortgage insurance (PMI) if you put down less than 20 percent. You may also need to buy new furniture to fill the extra space that comes when you upgrade from a one-bedroom apartment to a two-bedroom house.
You won't want to completely tap out your savings to buy your home. You'll want to make sure you still have some money on hand for those unexpected "joys" that come with new homeownership, like replacing a furnace or fixing a leaky pipe.
1. Create your home savings fund
First, consider opening a high-rate savings account dedicated to your savings goal and keep it completely separate from your other accounts, so you're not tempted to dip into it. You could break it down even further, with one account for your down payment and purchase costs and another account for post-purchase costs like new furniture or the hardware store runs you may be doing as a new homeowner.
2. Practice "paying your mortgage"
One tip Alliant's mortgage experts recommend is to simulate setting aside the amount of money you'd be spending on housing costs when you buy your new home in your new home savings account—basically, the difference between your rent and those future housing costs, including things like your mortgage, higher utility bills, and parking. This gives you a chance to practice "paying your mortgage" before you actually own the home.
If you struggle to make the monthly mortgage payment work for 3-6 months, then you may have missed the mark when calculating your home affordability. If saving that extra money doesn't strain your budget, you'll know you're on the right track. Plus, the money you set aside "paying your mortgage" will fund your home savings account.
3. Break your savings goal into smaller bites
Going back to our earlier example of putting down 20%, let's say you need to save a total of $70,000 for your down payment, closing costs, and other immediate costs of purchasing a home. If you're starting from zero and you want to buy a home in two years, you would need to save $2,916 per month. Breaking a large goal into monthly (or even weekly) targets makes it feel far more achievable.
4. Get your debt under control
Having debt, whether it's student loan debt or credit card debt, makes it more difficult to save, and it can also make it more difficult to qualify for a low-rate mortgage. You might want to consider paying off loans early or consolidating your debt to help you save money, improve your credit score, and simplify your life with less bills to worry about.
5. Consider putting your retirement savings on hold temporarily
The key word here is "temporarily." If you're close to retirement, such as within 5-10 years, this probably isn't the best strategy for you. But if you're young(er) and already contributing to an IRA or 401(k), think about putting some of that money toward savings for your new home. This can help you grow your down-payment fund faster.
Remember, this is just a short-term tactic. As soon as you have saved enough for your home, you can start up your retirement savings again.
6. Up your take-home pay
Budgeting is a great way to start saving extra cash. However, it only addresses one part of the equation. In addition to decreasing expenses, work on increasing the amount you bring home.
Put your savings into high gear by taking on a side hustle or asking for more hours and projects while saving for a home. When you increase your income with these temporary jobs, you can get closer to your down-payment goal and save for a house more quickly.
Whether you’re just starting to save for a home or getting closer to buying, Alliant in partnership with Beyond can help you move toward homeownership with Alliant Journey Home Savings.
Save consistently and get rewarded
Journey Home Savings is designed to make saving for your down payment easier and more rewarding. When you follow Alliant’s home savings plan and deposit at least $300 monthly over an 18-month period, Alliant will match the interest you earn, up to $1,500, at closing.1 Think of it like getting a 100% bonus on the interest you earn through Journey Home Savings.
After your first month’s deposit, an Alliant loan officer will reach out to help you create a personalized plan for financing your future home.
Saving for a home can feel overwhelming, but it doesn’t have to feel out of reach. With a clear plan, steady progress, and the right support along the way, each time you save brings you closer to your new front door. From helping you build your savings to guiding you through the mortgage process, Alliant is here to support you throughout the journey, from your first step to your next home.
1. Alliant Credit Union Journey Home Savings Promotion Terms and Conditions
Eligible new and existing members may qualify for one of the available bonus opportunities depending on which of the following requirements are satisfied:
Entering the Promotion
• New Members: All account applications are subject to approval. New members may enroll into the promotion by opening a High-Rate Savings (S01) account between September 16, 2026, and April 30, 2027, via the promotional landing page.
• Existing Members: Members with existing High-Rate Savings (S01) accounts may enroll by completing the form on the promotional landing page between September 16, 2026, and April 30, 2027.
Deposit Requirements: Participants must deposit at least $300 (“Qualifying Deposit”) each calendar month for eighteen (18) months (“Qualification Period”) into their eligible High-Rate Savings (S01) account. Dividend credits, promotional credits, and other amounts determined by Alliant do not satisfy the monthly deposit requirement. Participants must make the first monthly deposit by the last day of the calendar month following enrollment in the promotion*. After making the first Qualifying Deposit, Participants may miss up to two (2) monthly deposit requirements without disqualification.
Mortgage Requirement:
• Participants must close on a Qualifying Alliant mortgageI or Qualifying non-Alliant mortgageII after completing all Qualifying Deposits in the Qualification Period and no later than the last day of the forty-second (42nd) calendar month following the last month of the Qualification Period*.
• Participation in this promotion does not guarantee mortgage approval.
• For Qualifying non-Alliant mortgages, Participants must provide a fully executed Closing Disclosure as proof of closing within 60 days of mortgage closing.
Qualifying Alliant Mortgage Dividends and Bonus:
After all promotion requirements have been met, Alliant will provide a bonus equal to the dividends credited to the Participant’s High-Rate Savings (S01) account during the Qualification Period and through the date the Participant’s written Intent to Proceed is received by Alliant for the new mortgage, up to a maximum of $1,500III. A Qualifying Alliant mortgage may receive only one bonus, regardless of the number of borrowers or co-borrowers on the loan who may have participated in the Journey Home Savings Promotion.
The bonus will first be applied toward eligible closing costsIII, IV on a Qualifying Alliant mortgage at mortgage closing. The closing-cost credit may not exceed the Participant's actual eligible closing costs and will be applied only to the extent permitted by applicable investor, agency, insurer, and regulatory requirements. Any remaining bonus amount that cannot be applied as a closing creditIII will be credited to the eligible High-Rate Savings (S01) Account within the 60 days following mortgage closing.
Qualifying Non-Alliant Mortgage Dividends and Bonus:
After all promotion requirements have been met, Alliant will provide a bonus equal to twenty-five percent (25%) of the dividends credited to the Participant’s High-Rate Savings (S01) account during the Qualification Period and through mortgage closing, up to a maximum promotional credit of $375. A Qualifying non-Alliant mortgage may receive only one bonus, regardless of the number of borrowers or co-borrowers on the loan who may have participated in the Journey Home Savings Promotion. The bonus will be deposited to the Participant’s eligible High-Rate Savings (S01) account within 30 days after Alliant receives a fully executed Closing Disclosure as proof of closing on the Qualifying non-Alliant mortgage.
Participants must maintain Alliant membership and their eligible High-Rate Savings (S01) account in good standing through mortgage closing and in order for any bonus to be credited to the account. Closing the High-Rate Savings (S01) account before mortgage closing or before crediting of any bonus will result in disqualification from the promotion and forfeiture of the promotional benefit. Limit one offer per Alliant member. Alliant reserves the right to modify, suspend, or terminate this promotion, or correct any administrative, technical, or printing errors, if circumstances beyond Alliant's reasonable control impair the administration, security, or proper operation of the promotion. Any such action will be taken in accordance with applicable law. Offer is not transferable and not valid for UTMAs, IRAs or other tax-exempt accounts. Participants will be responsible for any tax liability. Alliant reserves the right to disqualify Participants for fraud, abuse, or failure to satisfy promotion requirements. Must be 18 or older at time of account opening and a U.S. Resident or U.S. Person (including a U.S. Resident Alien) to be eligible. This promotion is subject to all federal, state and local laws and regulations and governed by Illinois law. Promotion is sponsored by Alliant Credit Union, 11545 W. Touhy Ave., Chicago, IL 60666.
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