confused about Honeywell wire saver?

I just purchased a Honeywell TH8320ZW1007 Thermostat and it came with a wire saver module since I only have a four wire system and the thermostat requires five wires. My confusion is where do you mount the wire saver, beside the thermostat or at the AC unit. I can’t find any pictures showing it mounted anywhere and the instructions are very vague. Anyone done this install?

Mounts in the furnace or the air handler where the thermostat wires terminate. there is a wiring diagram in the install manual.