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An Altar should always be placed in a "respectful" position - away from bathrooms, kitchens etc. If you do not have a special meditation room, a good place is near the entrance or in the main living room of your home.
Usually, there is a central figure, often in the form of a Statue but you can also use a Thangka or a Postcard Image of your chosen deity.
The main figure, usually Shakyamuni Buddha, is placed in the centre of your altar and if you have space, you can put other deities on either side (usually slightly smaller than the central figure).
Now for the offerings. Different forms of offering may be made. One that is commonly used is by placing a set of 7 offering bowls in a line, in front of your central figure. The bowls are filled with water (preferably coloured with a stick of saffron) and represent the seven branches of prayer.
Another form of offering is to use a set of seven offering bowls and a Butter Lamp. These represent the eight offerings:
water for washing;
water for drinking;
flowers (these can be real or artificial);
some sticks of incense (for burning or to represent this);
light (with a candle in the Butter Lamp);
saffron (this can be placed in water);
food (you can use fruit or sweets or even uncooked rice);
and music (a Tingshak can used to represent this)
To complete your altar, you should place some form of Buddhist text on the left side. This represents the words of Buddha. Finally, a small Stupa is put on the right side to symbolize the mind.
And there you have your altar.
This book may be of interest:
TIBETAN BUDDHIST ALTAR
by Valrae Reynolds
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