Buying a home is a major commitment, and it may mean making sacrifices. First, you should find out how much you can afford. Once you figure out how much house you can buy, you can estimate how much you will need for a down payment. That will give you a more solid goal to work toward. Make a deadline. For example, if you want to buy a house in five years, divide the down payment by five, and that amount is what you have to save every year over the next five years.
Write down a budget of your income and expenses, and see where you can reduce your variable expenses to reach that savings goal. It will probably require some tough sacrifices, like cutting back on eating out, vacations, entertainment, clothing, etc. You can even consider taking a second job temporarily.
You should set a special savings account just for the down payment. Every time you get paid, have your bank automatically transfer the predetermined amount into the special savings fund. Thus, you are paying yourself first.
It will be helpful if you pin up a photo of a house that you like (not necessarily one that you plan to buy) and a visual chart of your savings progress. You can watch the savings go up, month after month. Put that on your refrigerator so you can see it all the time as encouragement.
Resist the temptation to dip into the account. If you make a solid commitment not to touch that savings account, you will be able save up for your house.
Here are some more tips on how to save money: