How much should I save for a house?

Plan to save 8-23% of the home price: 3-20% for down payment plus 2-5% for closing costs. For a $400,000 home, that's $32,000-$92,000 depending on your down payment choice.

How long does it take to save for a house?

At a 15% savings rate, it takes 3-7 years to save a 20% down payment plus closing costs for most homes. First-time buyers can reduce this to 1-3 years with 3-5% down programs.

How Much to Save for a House (2026): Down Payment & Closing Cost Guide

Calculate exactly how much you need to save for a house and how long it will take based on your income and target home price.

House Savings Calculator: Quick Reference

Home Price	3% Down	5% Down	10% Down	20% Down	+ Closing Costs
$250,000	$7,500	$12,500	$25,000	$50,000	+$7,500-$12,500
$300,000	$9,000	$15,000	$30,000	$60,000	+$9,000-$15,000
$350,000	$10,500	$17,500	$35,000	$70,000	+$10,500-$17,500
$400,000	$12,000	$20,000	$40,000	$80,000	+$12,000-$20,000
$450,000	$13,500	$22,500	$45,000	$90,000	+$13,500-$22,500
$500,000	$15,000	$25,000	$50,000	$100,000	+$15,000-$25,000
$600,000	$18,000	$30,000	$60,000	$120,000	+$18,000-$30,000
$750,000	$22,500	$37,500	$75,000	$150,000	+$22,500-$37,500

Total Savings Needed (Down Payment + Closing Costs)

For a $400,000 home:

Down Payment	Amount	Closing Costs (3%)	Total Needed
3% (FHA/Conv)	$12,000	$12,000	$24,000
5%	$20,000	$12,000	$32,000
10%	$40,000	$12,000	$52,000
20% (No PMI)	$80,000	$12,000	$92,000

Note: Closing costs can sometimes be negotiated with seller or rolled into loan

Down Payment Options Explained

Down Payment	Loan Type	PMI Required	Best For
0%	VA Loan	No	Veterans/active military
0%	USDA Loan	No (guarantee fee instead)	Rural areas
3%	Conventional	Yes (~0.5-1% annually)	First-time buyers, good credit
3.5%	FHA	Yes (MIP for life)	Lower credit scores
5%	Conventional	Yes (~0.3-0.8% annually)	Moderate savings
10%	Conventional	Yes (~0.2-0.5% annually)	Balanced approach
20%+	Any	No	Maximum equity, lowest payment

PMI Cost Impact

Private Mortgage Insurance adds to your monthly payment:

Home Price	Loan at 5% Down	Est. Monthly PMI	Annual Cost
$300,000	$285,000	$140-$240	$1,680-$2,880
$400,000	$380,000	$190-$320	$2,280-$3,840
$500,000	$475,000	$235-$400	$2,820-$4,800

PMI typically drops off when you reach 20% equity.

Closing Costs Breakdown

Cost	Typical Range	On $400K Home
Loan origination fee	0.5-1%	$2,000-$4,000
Appraisal	$300-$600	$450
Home inspection	$300-$500	$400
Title insurance	0.5-1%	$2,000-$4,000
Attorney fees	$500-$1,500	$1,000
Escrow/prepaids	2-3 months PITI	$3,000-$5,000
Recording fees	$100-$300	$200
Total	2-5%	$8,000-$20,000

How Long to Save: Timeline Calculator

Based on Monthly Savings

For a $400,000 home with 10% down ($52,000 total needed):

Monthly Savings	Time to Goal
$500	8.7 years
$750	5.8 years
$1,000	4.3 years
$1,500	2.9 years
$2,000	2.2 years
$2,500	1.7 years
$3,000	1.4 years

Based on Income (15% savings rate)

Household Income	Monthly Savings	Years to 20% on $400K
$50,000	$625	12.3 years
$75,000	$938	8.2 years
$100,000	$1,250	6.1 years
$125,000	$1,563	4.9 years
$150,000	$1,875	4.1 years
$175,000	$2,188	3.5 years
$200,000	$2,500	3.1 years

Savings Strategies to Buy Sooner

Option 1: Lower Down Payment

Strategy	Savings Needed	Tradeoff
3% down vs. 20%	$24K vs $92K	Pay PMI, higher monthly payment
5% down vs. 20%	$32K vs $92K	Pay PMI, higher monthly payment
10% down vs. 20%	$52K vs $92K	Pay PMI, higher monthly payment

Option 2: Down Payment Assistance Programs

Program Type	Benefit
State HFA programs	Grants or 0% loans, $5,000-$25,000
First-time homebuyer grants	$5,000-$15,000
Employer assistance	Some employers offer $5,000-$10,000
IRA withdrawal	Up to $10,000 penalty-free for first home

Option 3: Reduce Target Home Price

Original Target	Reduced Target	Savings at 10% Down
$400,000	$350,000	Save $5,000
$400,000	$325,000	Save $7,500
$400,000	$300,000	Save $10,000

Option 4: Gift Funds

Source	Considerations
Family gift	Document with gift letter; no repayment expected
Gift limit	No limit for down payment (may have gift tax implications for giver above $18K/year)

Where to Keep Your Down Payment Savings

Account Type	Best For	Interest Rate
High-yield savings	0-2 years away	4-5%
Money market	0-2 years away	4-5%
CDs (laddered)	1-3 years away	4-5%
I-Bonds	1-5 years away	Variable (inflation-protected)

Avoid keeping down payment savings in stocks if buying within 3 years—too much volatility risk.

Monthly Savings Plan by Home Price

To buy in 3 years with 10% down + closing costs:

Home Price	Total Needed	Monthly Savings
$250,000	$32,500	$903
$300,000	$39,000	$1,083
$350,000	$45,500	$1,264
$400,000	$52,000	$1,444
$450,000	$58,500	$1,625
$500,000	$65,000	$1,806

Hidden Costs to Budget For

Beyond down payment and closing costs:

Cost	Typical Amount	When Due
Moving expenses	$1,000-$5,000	At closing
Immediate repairs	$500-$5,000	First month
Furniture/appliances	$2,000-$10,000	First 6 months
Emergency fund (3-6 months)	$5,000-$15,000	Before buying
First property tax payment	3-6 months escrow	At closing

Conservative total to have saved: Down payment + Closing costs + $10,000 buffer = Peace of mind

Tags: