A backyard. Garage parking. No onsite landlord you have to answer to. It is easy to see the appeal of homeownership. So what's the main thing that stops a person from snagging their dream home? The daunting cost of a down payment.

The fact of the matter is, it's hard to save money.

With so many of us living paycheck to paycheck, a 20% down payment on a house can seem near impossible. While it's true that most purchase a house with far less down than that, many still strive for that golden percentage. Why? Because 20% down puts a good dent in what you owe on the house, which makes way for competitive interest rates and lower monthly payments. If you have a conventional loan, a down payment of this size also eliminates the need for private mortgage insurance.

It's important to do your homework about the type of loan that is right for you and the amount of money that makes sense to put down. No matter which course of action you decide on, you'll still need to save a significant amount of money. Here are five tips to help you do just that.

Analyze Your Current Spending Habits

The best way to analyze your current spending habits is to list out all of your monthly bills and then add in the other things you spend money on, like food, clothing, and fun activities. Seeing the amount of money you're spending on say, getting to-go coffee every morning, can be eye-opening. The small things we purchase every day add up over time, making it difficult to realize just how much money is being spent overall.

For a more accurate estimate of what you're spending money on, track all of your purchases over one month. You'll be surprised at how much you can save by just being more aware of the things you are buying on a day-to-day basis!

Look for Alternatives

Now that you have a better understanding of your finances, it's time to explore more affordable alternatives to the things you enjoy, whether that be making coffee at home every morning or switching your $60 a month gym membership to a new gym that is $35 a month. You could even consider working out at home for a month two. Remember, it isn't necessary to eliminate the ways you unwind or enjoy your downtime; just see what other more cost-effective options are out there.

People are often surprised by how much they spend on food. It can be difficult to maintain a work-life balance and many times we succumb to ordering takeout. Consider meal prepping on the weekend so you have things ready to go during the week.

From making the switch from expensive cable to an affordable streaming service, to also canceling a streaming subscription you hardly watch, to using public transportation a few times a week, there are many affordable alternatives you can incorporate into your life without feeling like you're making huge sacrifices.

Save at the Start of Each Month

With two paychecks a month, most of us play first and save later. Reverse that habit. Put money away up front, rather than buying clothes or treating yourself to a night out. Once all of your bills have been paid and you've put away a portion of your paycheck, then you can consider treating yourself.

What's even better than immediately setting aside money from your first paycheck each month? See if you can set up direct deposits with your employer that automatically sends a portion of your payment into a savings account. That way you won't see the full amount at all and won't be tempted to spend it.

Monetize a Hobby

An unexpected way to save for a down payment? Monetize a hobby that you excel at. Thanks to online platforms that make it easy to sell homemade goods, like Etsy, it's now easier than ever to get a small business off the ground.

You don't have to be a skilled craftsman or excellent designer to make some extra money. You can still snag a side gig that will help bring you one step closer to your down payment goal. When it comes to saving for a house, every bit helps! There are several side hustles available, from online tutoring to driving for Lyft a few times a week. Think about the things you enjoy doing and how you can monetize any of those things without having to spend money to get set up.

Reward Yourself

Life is meant to be enjoyed. It's easy to get burnt out when we don't stop and treat ourselves. Set money-saving goals and rewards for when you hit those goals. This will help you from becoming hyper-focused on only saving money and ensure you take a much-needed break every so often.

Rewards can be any number of things, from a nice dinner out to a pair of shoes you've had your eye on. Believe it or not, this also helps cut down on unnecessary spending, as you have your goal in mind and the way you'll treat yourself when you hit that goal.

Eyes on the Prize

If you're just beginning the process of saving for a down payment on a house, it can seem overwhelming. Don't get discouraged! Many have started exactly where you are now and have gone on to purchase their dream home.

Put the above tips to use to start saving today. You'll be surprised at how much you can put away in just a year's time! When the time comes to start looking at your mortgage options, let Lendgo help you find and compare rates!